LinksSpy – Monthly Income Report April 2015

I am again pretty late with my income report for April 2015. LinksSpy has lost about 10% MRR in April.

But before I dive deep into this, first let me get some boilerplate out of the way.

Preface

You can find all my income reports here: http://www.christophengelhardt.com/income-reports/.

These are the ground rules for my income reports:

  1. I publish income reports for two reasons: a) Accountability helps me push forward. b) I know that most of us compare ourselves to internet-famous people like Patrick McKenzie, Brennan Dunn, Nathan Barry and others. I am no stranger to that and it is hard to feel good comparing yourself to them. Well, compare yourself to me and you’ll feel better instantly 😉
  2. I will only cover what I make from LinksSpy – no consulting, no day job
  3. I am terrible at accounting – so most numbers (especially expenses) are not 100% accurate.
  4. I have an agreement with Nathan Powell of nusii.com that I will stop income reports by the time I hit $1,000,000 annual run rate. According to Nathan that should happen sometime in June 2015 – we’ll have to see about that (It’s pretty much out of the question at this point 😀 ).

The Numbers

Last Month’s Revenue

In March monthly recurring revenue (MRR) for LinksSpy was $1,296 from 38 customers.

This Month’s Revenue

In April MRR dropped to $1,158 MRR coming from 36 customers at the end of the month.

MRR growth graph for LinksSpy

MRR growth graph for LinksSpy

Expenses

Due to the way LinksSpy is set up my costs are relatively low. It was one of my design goals to keep most things running on Heroku‘s free tier. This is partly because I’m really cheap and – more importantly – because I didn’t know how well LinksSpy would do and I was afraid of catastrophic failure.

Total expenses:

  • $36 to Heroku for database, SSL and Papertrail
  • $67 in Stripe fees
  • $49 for Drip
  • $12 for HireFire.io
  • $10 for Google Apps/GMail
  • $40 for PerfectAudience retargeting
  • $70 to oDesk for research
  • $195 for blogging services
  • $7 for Github
  • $8 for Calendly
  • $8 for Dropbox
  • $20 for Churnbuster.io
  • $55 to oDesk for five articles of my next big content piece

The totals for this month are $591.54.

Profit

LinksSpy made a profit of about $566 this time. I’m going to spend it somehow. Probably on a ticket to MicroConf Europe.

Traffic

blog.linksspy.com: 543 sessions
www.linksspy.com: 1,106 sessions

Progress

OK. This month was bad. I lost a good chunk of MRR and didn’t make much progress on other fronts.

The new feature (a.k.a. new data provider) does not seem to provide a lot of value to the beta testers. I guess it needs more work to better show off the value. I invested a bit of time to improve it, but it needs more.

Secondly, I wanted to improve the onboarding, but didn’t do anything about it. Well, I’m keeping that on the list and will hopefully get to it in June (I’m writing this at the end of May).

Lastly, I evaluated the content marketing I was doing in the past. I tried to use a tactic that I learned from Ruben Gamez. I hired a writer with a larger audience to write content for the LinksSpy blog.

The idea is that the writer will bring their audience to your content. In my case that amounted to roughly 300 visitors total at the price of $1,000. I don’t think that the experiment worked – at least not in its current form.

I still think it is a good tactic, but it sure needs some fine-tuning to work properly.

What to Focus on Next Month

Well… I didn’t do much in May either. So I’m not going to talk a lot about it.

My Takeaways

I need to find a traction channel that brings in much more traffic than I currently get. In the past my biggest success was knowing people. I might just have an idea for a traction channel that produces content to publish and helps me connect with other people in the industry. We’ll see how it works – if it works.

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LinksSpy – Monthly Income Report March 2015

LinksSpy has been rather stable in March with only a slight upwards trajectory of about 4% in terms of realized MRR while at the same time losing 5% of the users.

But before I dive deep into this, first let me get some boilerplate out of the way.

Preface

You can find all my income reports here: http://www.christophengelhardt.com/income-reports/.

These are the ground rules for my income reports:

  1. I publish income reports for two reasons: a) Accountability helps me push forward. b) I know that most of us compare ourselves to internet-famous people like Patrick McKenzie, Brennan Dunn, Nathan Barry and others. I am no stranger to that and it is hard to feel good comparing yourself to them. Well, compare yourself to me and you’ll feel better instantly 😉
  2. I will only cover what I make from LinksSpy – no consulting, no day job
  3. I am terrible at accounting – so most numbers (especially expenses) are not 100% accurate.
  4. I have an agreement with Nathan Powell of nusii.com that I will stop income reports by the time I hit $1,000,000 annual run rate. According to Nathan that should happen sometime in June 2015 – we’ll have to see about that.

The Numbers

CAVEAT: I’m changing the way I retrieve MRR data. I’m using FirstOfficer.io going forward to get data. This will change some numbers, but nothing major

Last Month’s Revenue

In February monthly recurring revenue (MRR) for LinksSpy was $1,285 from 39 customers.

This Month’s Revenue

March ended with $1,296 MRR coming from 38 customers. This is more or less the same it was in February.

LinksSpy MRR graph

LinksSpy MRR graph by FirstOfficer.io

Expenses

Due to the way LinksSpy is set up my costs are relatively low. It was one of my design goals to keep most things running on Heroku‘s free tier. This is partly because I’m really cheap and – more importantly – because I didn’t know how well LinksSpy would do and I was afraid of catastrophic failure.

Total expenses:

  • $36 to Heroku for database, SSL and Papertrail
  • $75 in Stripe fees
  • $49 for Drip
  • $12 for HireFire.io
  • $10 for Google Apps/GMail
  • $40 to oDesk for research
  • $195 for blogging services
  • $7 for Github
  • $8 for Calendly
  • $8 for Dropbox
  • $20 for Churnbuster.io
  • $25 to oDesk for five articles of my next content push
  • $960 for three guest articles

If I didn’t miss anything (which I probably did), the total costs were $1,484.90.

Profit

For the first time in five months I spent more on LinksSpy than I earned from it – fantastic news.
The bulk was spent on hiring an author with an existing audience for three articles. It’s going to be interesting

Traffic

blog.linksspy.com: 919 sessions
www.linksspy.com: 1,113 sessions

Progress

Firstly, I finished the new integration in early March and beta testing is now well underway. This is great news for my users as they will be able to get more up-to-date link opportunities, which will make it even easier to get new links.

Secondly, LinksSpy now automatically checks each entered URL for a redirect. LinksSpy uses an exact match algorithm, meaning that when you enter “doubleyourltv.com” LinksSpy will only look at links to “doubleyourltv.com”. This allows users to laser-focus their campaigns – John Turner has written a detailed article on how to leverage that.
The problem here is when “doubleyourltv.com” redirects to “www.doubleyourltv.com”: Browsers follow that redirection and people end up linking to “www.doubleyourltv.com” most of the time.

In essence, this leads to campaigns showing very few link opportunities, when – with the right URL – there would be 100’s of link opportunities. Anyways, this is now “fixed” and users get alerted to the redirect while still having the flexibility to use the URL they entered. This has improved onboarding quite a bit.

Thirdly, I redesigned the incentive landing page where people can opt-in to my email course while getting a competitive link analysis report as a lead magnet. I also put a bit of work into the homepage, which now has CTAs for the link competitive link analysis report.

01_start 02_background-copy 03_white-box-blue-border 04_subheading-margin-smaller-textarea-alignment 06_different-headline-sub-button-text

 

 

Lastly, I did my taxes and hired a new writer for the blog. Taxes were tremendously fun… NOT.

What to Focus on Next Month

In April I’m going to focus on the onboarding process. The feedback I get from users points me to them often not seeing enough value right after start.
I have some ideas on how to improve onboarding and that is what I will be focusing my time on.

My Takeaways

I definitely improved my email marketing, which will be a great asset moving forward. I’m super stoked about the new feature I am developing and hope it will deliver great results. If my predictions are true (they probably aren’t), this feature will help reduce churn.

At the moment updates to the underlying data are few and far between (>1 month between updates on average), which leaves a lot of room for my customers to forget about LinksSpy. Not a happy place to be in ™.
With the new feature at least customers on the highest plans will get weekly updates, which should help quite a bit.

Conclusion

Baby steps to victory. That’s all I’m going to say for this month.

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LinksSpy – Monthly Income Report February 2015

LinksSpy has seen a bit of growth during February, not much mind you, but it’s going the right direction. But before I dive deep into this, first let me get some boilerplate out of the way.

Preface

You can find all my income reports here: http://www.christophengelhardt.com/income-reports/.

These are the ground rules for my income reports:

  1. I publish income reports for two reasons: a) Accountability helps me push forward. b) I know that most of us compare ourselves to internet-famous people like Patrick McKenzie, Brennan Dunn, Nathan Barry and others. I am no stranger to that and it is hard to feel good comparing yourself to them. Well, compare yourself to me and you’ll feel better instantly 😉
  2. I will only cover what I make from LinksSpy – no consulting, no day job
  3. I am terrible at accounting – so most numbers (especially expenses) are not 100% accurate.
  4. I have an agreement with Nathan Powell of nusii.com that I will stop income reports by the time I hit $1,000,000 annual run rate. According to Nathan that should happen sometime in June 2015 – we’ll have to see about that.

The Numbers

Last Month’s Revenue

In January monthly recurring revenue (MRR) for LinksSpy was $1,245 from 42 customers.

This Month’s Revenue

February ended with $1,285 MRR from 39 customers. Which is great, because it is slightly higher than the previous month.

05_february-mrr-growth

MRR growth for LinksSpy – provided by the fine folks of FirstOfficer.io

 

 

As you can see from the number of customers, a few customers in the lowest plan cancelled. That was offset by new customers in the higher-price plans. While I have fewer customers, the MRR increased. I lost $114 in MRR and gained $234 for a net MRR increase of $120.

So why do I only report an MRR that is $40 above last month’s? Let me show you another picture:

05a_february-past-due

$443 MRR are caught with past-due customers (i.e. their CC charge didn’t go through) – picture by HookFeed

 

That’s right. I currently have 8 customers with failing payments. Another 34.5% of my current MRR is “past-due”.

I’ve been historically bad at reaching out to people after their payments failed and sending dunning emails. I usually waited for 3 charges to fail, because that was something my friend Andrew recommended. Then I would loose count of how many failed charge each customer had and then I’d just let it be.
This is something I am going to tackle in March.

Expenses

Due to the way LinksSpy is set up my costs are relatively low. It was one of my design goals to keep most things running on Heroku‘s free tier. This is partly because I’m really cheap and – more importantly – because I didn’t know how well LinksSpy would do and I was afraid of catastrophic failure.

Total expenses:

  • $36 to Heroku for database, SSL and Papertrail
  • $74.67 in Stripe fees (More on that later)
  • $49 for Drip
  • $12 for HireFire.io
  • $10 for Google Apps/GMail
  • $40 to oDesk for research
  • $195 for blogging services
  • $50 for a VA

If I didn’t miss anything (which I probably did), the total costs were $466.67.

Profit

For the time being, I don’t plan on making any profit from LinksSpy. I want to focus on growing it as fast and as big as possible, thus I’m re-investing everything back into LinksSpy.

LinksSpy made roughly $800 in profit this month. That means it has made a (small) profit in 4(!) consecutive months and I really want to change that (i.e. blow that money on marketing).
Something always keeps me from doing so.

My war chest is filled with a bit of money and my intention is to spend that money on marketing.

I’ve come to an agreement with two new bloggers who will do paid guest posts on the LinksSpy blog and I guess think I am going to spend the money this way. Additionally, I think I am probably going to invest money into one big content piece, because it would take me half a year or more to finish it on my own.

Traffic

Traffic numbers for this months aren’t spectacular.
One thing of note: Almost 400 users came from a single list/collection on Product Hunt. AMAZING!

blog.linksspy.com: 375 sessions – 311 users
www.linksspy.com: 1,594 sessions – 1,208 users

Progress

February was a month of rather small wins: I set up an email campaign for users who start the signup process and abandon it. They will get two follow-up email.
In case you want to use it, here are the two emails:

Subject: Start stealing links today
Hi {{subscriber.first_name}},

You started the registration for LinksSpy a few hours ago, but stopped before finishing it.
Was there a problem?
Is there anything I can help you with?

You can continue the registration at: https://www.linksspy.com/account/registration

Cheers,
Christoph
Founder, LinksSpy.com

Subject: Don’t leave me this way…
Hi {{ subscriber.first_name}},

You started the registration for LinksSpy yesterday, but got stuck half-way through.
Is there anything that’s blocking you?
If so, how can I help you get unblocked and start earning links to crush your competition?

Cheers,
Christoph
Founder, LinksSpy.com

Additionally, I followed Rob Walling’s advice and dropped the mandatory cancellation reason box in favor of an automatic follow-up email after cancellation.
The reasoning here is that users are frustrated if you make it complicated to cancel their subscription, but once they answer to an email it’s relatively easy to get a conversation going.

Here’s the text for that email – an exact copy of Rob’s email:

Subject: A quick question…
Hello,

I was hoping you could spare 15 seconds of your time and let me know why you decided to cancel your LinksSpy account. Feel free to just hit reply and fire away.

Thanks in advance,

Christoph
Founder, LinksSpy

P.S. I’d really appreciate your reply – even if it’s just a few words letting me know why you decided to cancel.

Apart from the improvements to my email campaigns, I also took part in a few expert roundup posts such as this one: http://www.bloggingcage.com/best-link-building-strategies/ – yes, apparently my opinion is almost as important as Neil Patel’s.
Yes, I am also utterly shocked by that.

Furthermore, I invested a lot of time to implement proper invoicing and reporting for LinksSpy. That took a lot of time, but it was necessary to file my taxes. Sometimes you’ve got to spend some time on the plumbing.

Lastly, I started a rather big new feature, which will improve the quality as well as the frequency with which LinksSpy delivers link opportunities for your campaigns. I finished an early version in early May and am getting the first beta users set up with it as I write this.
Pretty excited about that one, as I hope that weekly emails will help make LinksSpy’s value more easily understood by my customers.

What to Focus on Next Month

In March I am STILL going to focus on growing my list with my new lead magnet (Get a free competitive link analysis in exchange for your email address).
I have to make a slightly less ugly version of that site and want to promote it on other blogs and podcasts.
Then I have to figure out how to properly promote it.

Additionally, I am going to do something about the “past-due” issues.

My Takeaways

I definitely improved my email marketing, which will be a great asset moving forward. I’m super stoked about the new feature I am developing and hope it will deliver great results. If my predictions are true (they probably aren’t), this feature will help reduce churn.

At the moment updates to the underlying data are few and far between (>1 month between updates on average), which leaves a lot of room for my customers to forget about LinksSpy. Not a happy place to be in ™.
With the new feature at least customers on the highest plans will get weekly updates, which should help quite a bit.

Conclusion

Baby steps to victory. That’s all I’m going to say for this month.

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LinksSpy.com – Monthly Income Report January 2015

It’s already mid-february when I write this. Honestly, I can’t say why I pushed it away for so long, I just didn’t feel like doing it. But what good are income reports if you don’t continue?
Thanks a bunch to Cezar Floroiu for gently reminding me that I had kept you waiting. Sorry for keeping you all waiting.

LinksSpy was on a “stable” trajectory for January, but I’ll talk about that later. First let me get some boilerplate out of the way.

Preface

You can find all my income reports here: http://www.christophengelhardt.com/income-reports/

These are the ground rules for my income reports:

  1. I publish income reports for two reasons: a) Accountability helps me push forward. b) I know that most of us compare ourselves to internet-famous people like Patrick McKenzie, Brennan Dunn, Nathan Barry and others. I am no stranger to that and it is hard to feel good comparing yourself to them. Well, compare yourself to me and you’ll feel better instantly 😉
  2. I will only cover what I make from LinksSpy – no consulting, no day job
  3. I am terrible at accounting – so most numbers (especially expenses) are not 100% accurate.
  4. I have an agreement with Nathan Powell of nusii.com that I will stop income reports by the time I hit $1,000,000 annual run rate. According to Nathan that should happen sometime in June 2015 – we’ll have to see about that.

The Numbers

Last Month’s Revenue

In December monthly recurring revenue (MRR) for LinksSpy was $1,210 from 41 customers. I had lost 13% MRR, which was giving me headaches. Especially because by the time I wrote the income report it had dropped further down to $1,087 and that was painful to watch.

This Month’s Revenue

January was a special months in that LinksSpy lost $193 MRR and added only $57 MRR – if one looks only at new customers. However, for people who started using LinksSpy after MicroConf Europe the discount (3 months for free) ran out, which brings LinksSpy back up to $1,245 from 42 customers at the end of January.

04_january-mrr-growth

Again, most cancellations where from people on the lowest tier plan and who had been a customer for just one month.

Expenses

Due to the way LinksSpy is set up my costs are really low. It was one of my design goals to keep most things running on Heroku‘s free tier. This is partly because I’m really cheap and – more importantly – because I didn’t know how well LinksSpy would do and I was afraid of catastrophic failure.

That now has the benefit that I can spend all ma moneyz on marketing.

Total expenses:

  • $36 to Heroku for database, SSL and Papertrail
  • $73.61 in Stripe fees (More on that later)
  • $49 for Drip
  • $12 for HireFire.io
  • $10 for Google Apps/GMail
  • $189 to oDesk for programming
  • $99 for KingSumo Giveaways license
  • $130 for blogging services
  • $50 for Twitter ads
  • $40 for StumbleUpon paid discovery
  • $80 for a VA

If I didn’t miss anything (which I probably did), the total costs were $688.81.

Profit

For the time being, I don’t plan on making any profit from LinksSpy. I want to focus on growing it as fast and as big as possible, thus I’m re-investing everything back into LinksSpy.

LinksSpy made roughly $476 in profit this month. That means it has made a (small) profit in three consecutive months and I really really really really really want to change that (i.e. blow that money on marketing).
Something always keeps me from doing so.

My war chest is filled with a bit of money and my intention is to spend that money on marketing.

Traffic

I have not included traffic numbers before in my income reports, but I think they help give a better perspective. So I am going to include them here:

blog.linksspy.com: 1,003 sessions – 821 users
www.linksspy.com: 1,800 sessions – 1,345 users

Progress

It feels like I made very little progress in January. In early January I finished the integration of the VATMOSS form during signup. VAT MOSS is a ridiculous new European law that effectively now stops any non-business customer in the EU from using LinksSpy – that’s what “setting the environment for startups to grow and prosper” looks like.

Additionally, I overhauled LinksSpy to send out better receipts. I have to rework this again, because it’s still not perfect. blah

I also added an XML-sitemap to the LinksSpy homepage – finally. I don’t know why I pushed that away for so long. And I did some link building and outreach, which is showing positive effects already.

Lastly, I started a giveaway for an Online Marketing Starter Pack and got some friends to contribute prizes (Brennan Dunn’s Double Your Freelancing Rate, Dave Collins did a website teardown). The pack was worth more than $1,000.
I did so many things wrong with that and I will dedicate a full article to my failure there, but it resulted in only 100 new email addresses to my list.
Which is waaaaaay less than what my friend Josh Earl managed to pull off.

What to Focus on Next Month

In February I am going to focus on growing my list with my new lead magnet (Get a free competitive link analysis in exchange for your email address). I plan on doing PPC ads for this as I have some money in the war chest. We’ll see if that works.

My Takeaways

I did a bit of outreach, started and failed horribly with the giveaway. I did marketing – way more than coding, which is great.
I learned a lot from the failed giveaway – or so I hope. I’ll run another one in March – we’ll see how that goes.

Not much else that I learned this month except that the road ahead is long.

Conclusion

January ended on a higher note than December and I am glad for it. I didn’t exactly grow the business, but I managed to keep it steady.
There are so many ways to improve it and I’m looking forward to iterating the product.

PS:
I am still on the look for a mastermind group(assuming the group meets after 16:00 UTC – 1 p.m. Eastern Time). If you have a mastermind group and would like me to join you, please reach out to christoph@$ANY_DOMAIN_I_OWN

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LinksSpy.com – Monthly Income Report December 2014

I don’t want to write this. I am afraid of writing this, because I feel like writing it will make it more “real” somehow. I wrote those two sentences and immediately switched tabs and opened up 9gag – to get away from writing this income report.

It’s not that LinksSpy is doing terrible or anything. It’s just that MRR fell from $1,392 to $1,210 at the end of december (and has since fallen to $1,087). That is causing me some anxiety.

Before I get too deep into this for the intro, here are a few things you might want to know before you read the full report.

You can find all my income reports here: http://www.christophengelhardt.com/income-reports/.

These are the ground rules for my income reports:

  1. I publish income reports for two reasons: a) Accountability helps me push forward. b) I know that most of us compare ourselves to “famous” people like Patrick McKenzie, Brennan Dunn, Nathan Barry and others. I am no stranger to that and it is hard to feel good comparing yourself to them. Well, compare yourself to me and you’ll feel better instantly 😉
  2. I will only cover what I make from LinksSpy – no consulting, no day job
  3. I am terrible at accounting – so most numbers (especially expenses) are not 100% accurate.
  4. I have an agreement with Nathan Powell of nusii.com that I will stop income reports by the time I hit $1,000,000 annual run rate. According to Nathan that should happen sometime in June 2015 – we’ll have to see about that.

The Numbers

Last Month’s Revenue

In November I had increased my MRR to $1392 from 46 customers. It was a month of great growth (~ 134% over the previous month), mainly due to being featured on ProductHunt at the end of October.

This Month’s Revenue

LinksSpy got $125 of new MRR in december, but it lost $509 MRR. Just look at the graph below:

03_december_mrr-growth

So at the end of december LinksSpy had $1210 MRR (according to my memory) coming from 41 customers.
Of the people who cancelled, only one was with LinksSpy longer than one month. The rest signed up right around the time LinksSpy was featured on ProductHunt.

Expenses

Due to the way LinksSpy is set up my costs are really low. It was one of my design goals to keep most things running on Heroku‘s free tier. This is partly because I’m really cheap and – more importantly – because I didn’t know how well LinksSpy would do and I was afraid of catastrophic failure.

Total expenses:

  • $36 to Heroku for database, SSL and Papertrail
  • $57.59 in Stripe fees (More on that later)
  • $49 for Drip
  • $20.62 for Retargeting with Perfect Audience
  • $29 on FacebookAds
  • $5 for email / Google Apps
  • $350 for a developer (including hiring process/test project for 2 developers)
  • $149 for a promotional video (View it on the LinksSpy homepage)
    If I didn’t miss anything (which I probably did), the total costs were $899.61.

Profit

For the time being, I don’t plan on making any profit from LinksSpy. I want to focus on growing it as fast and as big as possible, thus I’m re-investing everything back into LinksSpy.

LinksSpy made roughly $310 in profit this month. I am going to spend this mostly on marketing in January.

Traffic

I have not included traffic numbers before in my income reports, but I think they help give a better perspective. So I am going to include them here:

blog.linksspy.com: 301 sesssions, 211 users
www.linksspy.com: 1,103 sessions, 685 users

Progress

I was away on vacation for 10 days right before christmas and then I didn’t really do anything for the remainder of the year.

The main things I got done were the video and finishing the code for the new “give me your email” incentive. I need a better design for the resulting PDF files before I can push it live. And I am yet undecided whether I should put the incentive on the front page; maybe instead of the promotional video;
Or maybe below the promotional video.

Sadly, I made next to no progress on my other content piece/marketing asset. This involves writing about 200 articles on SEO topics – I have finished a grand total of 1! Yay…

Lastly, I think that I have not found product/market fit with LinksSpy yet. My customer base is too small to be really sure about churn rate, but it seems to be somewhere in the 10-15% range, which I have been told is too much.
Looked at it from another perspective: I added $125 in new MRR last month, but at $1,210 MRR total that growth would get entirely cancelled out by churn. So in addition to more/better marketing, I feel like I also need to find a way to lower churn.

What to Focus on Next Month

First of all, I am going to focus on the giveaway I am starting tomorrow at blog.linksspy.com/giveaways/online-marketing-starter-pack/. I hope to collect a few hundred new email addresses – we’ll see how it goes. I’ll write a detailed after action report once it’s over.

Secondly, I will hire a VA to help me setup a process that will make sure that my email list gets an email from me at least twice a month.

Thirdly, I lost contact with my blog co-author – he just stopped responding to my emails – which is not good ™. I think about replacing him with an agency, but they cost twice as much and I am not entirely happy with the sample content they delivered.

My Takeaways

A rather interesting fact I learned this month is that on top of the standard 2.9% + $0.30 fee Stripe also charges a currency conversion fee of 2.0%.

Interestingly, I keep repeating myself here: I have to do more marketing. Somehow it seems like I don’t follow through with that.
Oh well, I’ll try it again: Christoph, do more marketing!

Conclusion

December was sobering in that I lost a lot of MRR and January didn’t exactly start out any better. I hope that the marketing I have planed for January will help turn the tide, but I am unsure on the effectiveness and my ability to follow through on the commitment.

I feel bad for the latter, but I feel that I have no option but to soldier on.

I think that my work schedule will be more predictable going forward, which would allow me to join a mastermind group again (assuming the group meets after 16:00 UTC – 1 p.m. Eastern Time). If you have a mastermind group and would like me to join you, please reach out to christoph@$ANY_DOMAIN_I_OWN

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Year in Review 2014

I am Christoph Engelhardt, the maker of LinksSpy.com and probably best known for my monthly income reports.

I run my business as a side project and work a day job in the defense industry. I usually get about 5-10 hours/week of work done for LinksSpy.

Acknowledgments

“If I have seen further it is by standing on the shoulders of giants.” Isaac Newton

I’ve had the help of many amazing and inspiring people who pushed me to where I am today. My thanks go out to:

  • My wife Katharina who puts up with my habit of working on weekends (often the only time we get to spend together), with my stress levels. Thank you for yet another great year full of beautiful moments worth remembering
  • Benedikt Deicke with whom I produce a (German language) podcast. Thank you for the countless times you’ve helped me bring LinksSpy back up and correct my worst code fuck-ups. Thanks for making me launch LinksSpy at a time when I didn’t feel it was good enough
  • Michael Buckbee for always pushing me to work harder and spending crazy amounts of time to do mockups, give detailed feedback, and re-write the whole storyboard for LinksSpy’s video
  • Dave Collins for placing your trust in me and committing to LinksSpy at a time when it was just a shell script that would crash 9 out of 10 times. Thanks for a number of great email discussions and for taking the time out of your vacation to meet Katharina & me
  • Charlie Irish for helping me do well on ProductHunt when LinksSpy got on there. Thanks for motivating me time and time again. Thanks for the dinner in London and some exceptionally memorable hours at MicroConf Europe in Prague
  • Rob Walling & Mike Taber for hosting my #1 podcast and an amazing conference. Thanks for sharing actionable tips and tactics, and for inspiring me to follow in your footsteps
  • all the people that hang out in the BBiz Slack chat: You are an inspiring group of people. Thanks for the priceless help and for cheering me on

The Business

My business consists of the following products/services:

  • LinksSpy.com – a tool that helps SEO professionals to find link opportunities for their client’s websites
  • TerminRetter.de – automated SMS & phone reminders for (mostly) dentists in Germany. This has been on auto-pilot for the whole year
  • a little bit of consulting work

The main product is LinksSpy, which gets almost all the love.
I just put the others up there for completeness and will write a few short paragraphs about each.

TerminRetter.de

A few years ago I thought it would be smart to clone Patrick McKenzie’s Appointment Reminder and sell to the German market. Long story short: It didn’t work quite as planned.

I just sucked at marketing (still do) and to sell this software I’d have to do a much better job than just having proper onboarding.

However, I didn’t invest any time into developing new features or doing anything with it this year and it still brought in some money. That’s pretty neat.

I am semi-actively thinking about putting some time into improving the marketing, but it would be a distraction to my work on LinksSpy. So I am probably not going to do it, although I think TerminRetter is a good business.

Consulting

Not a lot of interesting things to talk about here. It pays nicely, when I invest time into it. I don’t go out of my way to find work, it is all inbound.

No plans to change anything here. I want to focus on LinksSpy as much as possible.

The Executive Summary

It was a good year business-wise. I launched LinksSpy at the end of April and grew it to about $1,200 in (Monthly Recurring Revenue) in 8 months. It might not be much, but to me it means the world. LinksSpy has grown faster than I ever imagined.

LinksSpy started out with $190 MRR and I hit my goal of $600 MRR about a week before the deadline at the end of October. I set myself a new goal ($1,200 MRR by April 2015) and hit that goal just 3 weeks later.

The Year in Brief

I slow launched LinksSpy at the end of 2014 to a few select people on my mailing list. Over the course of the first quarter I worked with them to improve LinksSpy to a point where it consistently delivered value to them.

In April I implemented billing and pushed the product out the door.

LinksSpy started with no free trial and three tiers ($9/$19/$49). I changed that about 4 months in to a 7-day trial with $19/$49/$99 pricing. This was probably the single best decision for LinksSpy: the trial brings in more users and I can send them emails to keep them engaged.

In August I published a big research-driven article about paid links that got shared heavily in the SEO community and got me about 5,000 visitors. This resulted in a number of paying customers.

In early November and as a result of Dave Collins promoting LinksSpy during his talk at MicroConf Europe LinksSpy got featured on ProductHunt. That resulted in about 60+ signups and 20+ conversions.

As a result of that I hired a developer part-time to help me with LinksSpy. He’s currently ramping up, but I already like the impact he has on the development speed. I expect great things from this.

December was a slow month for me. I’ll write about that separately in my income report, but the short version is: I didn’t do much, so no growth and in fact I lost some MRR when people churned after testing LinksSpy for 1 month

What went well

Here are the things I think went well in 2014.

Launching before I felt ready

This was definitely a big win. When I launched LinksSpy it was a MINIMUM Viable Product. There was no way to lock out users who cancelled their subscription, there were no lifecycle emails, no receipts for charges on customer’s credit cards and not a single index in the database (resulting in bad performance).

The performance was so bad in fact, that LinksSpy could NOT have supported more than 18-20 customers at that point.

Add on top of that a way for users to cancel without deleting their subscription – meaning they still get charged although they cancelled(Read the full story).

Yes, it was that minimal. But you know what? It launched, it delivered value and it has grown from there.

If you are sitting on a – in your mind half-baked – product, show it to potential customers, improve it to the point where they get value and are willing to pay for it, then launch.

Charging more & introducing a trial

Allowing people to trial LinksSpy was a major win. I ask for a credit card upfront, so they have to cancel. When they cancel I ask them for feedback why they cancel. I’ve got some great feedback from that and was subsequently able to improve LinksSpy.
Signing up for a trial is an easier conversion than going straight to paying customer, so the conversion rate has improved, too.

On top of that I now make more per customer once they turn into paying customers. That comes with all sorts of cool effects: I care more about my customers (sad, but true), they care more about LinksSpy, and it filters out quite a few toxic customers.

Putting more effort into marketing

I have put a lot more work into marketing than with anything I did before LinksSpy.

I have reached out to influencers, written articles for LinksSpy’s blog, went onto a podcast and guest blogged about SEO for designers – to name just a few.
I also occasionally write to the LinksSpy mailing list and scan the relevant subreddits for interesting topics to chime in on.

Not all of this work, but some of it brought visitors to the LinksSpy website and some of those eventually converted to paying customers. YAY!

Talking to people about LinksSpy

Be it customers, prospects or conference attendees – I was way more comfortable talking about LinksSpy. At MicroConf Europe I repeated (and altered slightly) the pitch so often that I no longer have to think about it.

I’ve had a number of great Skype conversations about LinksSpy that have helped me guide product decisions. It’s fun to talk about your product and how it can help others.

Continually improving & staying motivated

In the past staying motivated was a major problem for me. I would start a new project, build it and abandon it almost immediately to start something new.
Not so with LinksSpy: I stayed on it and it seems to pay off.

What keeps my motivation up is customer support (of all things!): It’s so rewarding to get emails from people who are using LinksSpy and saving a lot of time because of it. It’s equally cool to hop on a video chat with people and explain LinksSpy to them.

Furthermore, I won’t deny this: Getting money is also very motivating. I’m a filthy capitalist pig – what can I say?

Building great relationships

In 2014 I only attended one conference (MicroConf Europe in Prague) but I had a blast there. I met old friends (Benedikt Deicke, Charlie Irish, Dave Collins, Brennan Dunn, Mike Taber, Rob Walling, Anders Pedersen – to name just a few) and made new friends (Chris Kottom, Jane Portman, Dominik Dotzauer, etc.).
Going to MicroConf is so fricking awesome (Sorry, Dave!) fun, full of actionable advice, and motivating. I can’t imagine doing this without attending MicroConf.

Additionally, I was able to meet some friends during my vacations to Great Britain (Charlie Irish, Dave Collins) and Dubai (Dan Clarke). That was great as both my wife and I enjoyed having dinner/afternoon tea with them.

Doing all this with a day job

I did all this while still working a (almost) normal day job. It’s been stressful at times, e.g. when I was in places without internet for 3 days.

Thanks to a mostly understanding wife I was able to put in some time on the weekends. I’d rather spend it with her, but that’s hopefully something I can correct in the future and cut back on the weekend work.

What didn’t go well

This is the more interesting part, because I need to remember not to do this wrong again – and you can probably avoid a few mistakes yourself if you read this carefully 🙂

Charging Customers Who Cancelled

This was the worst point of the business year for me. Are you into adrenaline rushes?
Try charging your customer’s credit cards although they have cancelled their account and wait for the emails to arrive. Believe me, this will be fun!
You can trust me, I’m a random guy on the internet! 🙂

In the end I figured the error in my code out (Thanks, Benedikt – again!), refunded everyone (not only those who wrote me), and they were happy ever after. But boy was that stressful – and stupid to begin with. You can read more about it in my income report for September.

Not enough marketing

I feel like I didn’t do enough marketing. Only one really good blog post (and a few mediocre ones), a bit of outreach here, a podcast interview there. I neglected my email list to the point where it is lukewarm at best.

I know that I should write my list at least twice a month, but somehow I never feel like I have good enough content. That’s probably bullshit, because I publish it on the blog anyways, so I might as well send it to my list – right?

I’ve also spent a few days to build a new incentive for people to give up their email addresses (a watered down version of the real LinksSpy reports – delivered as PDF to their email address). Additionally, I have built the infrastructure for a big content piece, but the content is still missing.

I need to get both projects out of the door and promote them properly.

Overall, I feel like I know a lot of the stuff, but it’s way more complicated to actually execute on the knowledge.
Oh well, there’s always room for improvement – right?

Progress was/felt slow at times

There are days/weeks when I don’t get anything done for LinksSpy. The latest example would be when I discovered Steam for Mac OS X, bought Civilization V, and wasted hours upon hours playing that game. It is addictive and soo much fun, though.

Sometimes I just can’t get myself to do anything productive after a day at work. There’s truth to the saying that you spend your best waking hours at work.

On the other hand, LinksSpy didn’t do too bad compared to other products in terms of growth. And I actually launched and have revenue – which is nice.

At MicroConf you could hand in your website URL for a teardown. It was brutal and your website got shredded in front of 150 people. The crowd was roaring with laughter from the snarky remarks of a Brit telling people that their website does not highlight the main benefit of the product.
Sounds bad? It is not! Because besides the honest to god feedback you get, you have to be aware of one thing: If you have a website, you are ahead of 99% of the population that are still making plans on how to hit it big.

Memo to self: This applies to you as well, Christoph! You’ve got something and it has revenue – be proud of that.

Not nearly enough systems in place

Would you like to know how much exactly I spent on LinksSpy this year? I can’t tell you. There are invoices all over the place and it will be a nightmare to collect them all for taxes.
I even pay a few bills with my private credit card, because I don’t have a company card. That forces me to wire some money from my business bank account to my private account. It’s messy.
I need a company credit card and a system to (semi-) automatically fetch all the receipts & invoices.

Want to publish a guest post on the LinksSpy blog? Best I can tell you is “send your stuff via email whenever you feel like it and I will”. When I get the article, read it, suggest edits, and eventually schedule for publication. Inconsistently, I do a keyword research and optimize the article for that keyword. Sometimes I forget to share the article on my social media accounts.
Basically the same can be said for the posts that my hired author does for the blog.
What I need is a checklist and a process to govern the publication of blog posts.

Not enough/No analytics

Where does LinksSpy get most of its traffic from? Which traffic source is the highest converting? What is the fricking LTV of a LinksSpy customer?

I can answer each of these questions with a solid “Yes….. No… I don’t know”. This is embarrassing at best. It does not help me steer the ship.

My excuse (of sorts) for this is that LinksSpy is still relatively small and I know which metric I need to grow first: unique visitors to the website (of which LinksSpy had 700 in the last month).

And I don’t really need quantitative data to know that my email marketing or the onboarding process are sub-par suck.

The Numbers

This is probably what you are here for, so let’s get to it.

Traffic:

  • Unique visitors: 7,986 (since April 28)
  • 46.4% referral traffic
  • 31.6% direct
  • 11.8% social
  • 7.8% organic search

Biggest drivers of referral traffic:

  • ProductHunt.com (2,704 visitors)
  • t3n.de (263 visitors)
  • it-engelhardt.de (225 visitors)

That means about one third of my traffic comes from ProductHunt alone… wow.

Revenue

At current market rate (conversion from EUR to USD) and according to the Stripe dashboard LinksSpy made $5,134.70.
That is as accurate as I can get before I do my taxes and without too much effort. The value is skewed by fluctuations in the exchange rate (the Euro lost quite a bit value this year).

HookFeed currently reports $1,191.50 MRR from 43 customers. And here’s a screen grab from FirstOfficer.io for you to go through my numbers. I am pretty close to my deadline for this review, so I didn’t have much time to look through the report. If you find something that I should look into, please let me know at christoph@$ANY_DOMAIN_I_OWN.

02_firstofficer-annual-report

Most of the customers came through ProductHunt (no surprise here as it was the biggest driver of traffic).

Expenses

As I stated above my accounting is a mess. These numbers don’t reflect what I will report to the IRS because a) I will find a bunch of expenses once I do my taxes and b) I can subtract my home office and other items from my taxes as well.

Here’s my best attempt right now:

  • $45 on Fiverr
  • $1,926.58 on oDesk
  • $84.12 for Facebook Ads
  • $154.42 for PerfectAudience
  • $231.58 for Heroku
  • $149 for a new video
  • $800 for blog posts to my hired author
  • $80 for Google Apps
  • $120 for domain names and hosting
  • $294 for GetDrip.com
  • about $1,500 total for attending MicroConf Europe (ticket, hotel, travel and hosting a dinner)

estimated total: $5,207.58

Now that I think about it, that is a pretty good estimate. There’ll be a few additional expenses somewhere and I spent more than I made, but that’s OK as I’m willing to invest a bit of money into LinksSpy.

Plans for 2015

3x MRR for LinksSpy

I want to grow LinksSpy from its current annual run rate of $14,298 to $40,000. That means I have to 3x the MRR. That seems ambitious – and a little bit daunting – to me.

The way to achieve this will be through focusing on marketing. I want to get on more podcasts and blogs with an SEO audience. Additionally I am working on another huge content piece and a new incentive for the drip email campaign.

Furthermore, I need find a way to improve the onboarding (and general user) experience of LinksSpy to make the value it provides more apparent to customers; both to increase “trial to paid” conversion and to reduce churn.
Churn seems to be around 10% (if I include the surge after ProductHunt where a lot of people stayed around for one month and then cancelled) and I need to lower that.

Lastly, I have plans to use another data provider to run the reports, which will increase the volume of link opportunities created and also provide more up-to-date data.

Work less IN the business and more ON the business

I started this process when I hired a writer for the blog and continued it when I brought on a part-time developer.

Having another developer on the team will improve the velocity with which I can deliver features for LinksSpy. Additionally, he’s a really good developer – much better than myself – so that should increase the code quality overall.

Secondly, I want to find a VA to help me with research for additional blog posts and to establish a process that will result in me consistently emailing my list twice a month.

Give a talk

I would really love to speak about my experience as a solo founder of a somewhat successful side project.
Maybe I can call up my professors and give a talk to students at my university. That could be an interesting topic for them.

I want to help others to be more successful.

Attend MicroConf Europe

I will attend MicroConf Europe if that is at all possible. The experience this year was amazing and I can’t wait to go back and meet my friends & idols.

Conclusion

LinksSpy is growing and – although I messed up things quite a bit – I did a few things right. I had amazing help on the way for which I could not be more thankful.

I will definitely continue to be rather transparent about LinksSpy, because I enjoy writing the income reports. It helps me to plan for the road the ahead and it’s great to read them after some time and think back how far I’ve come. Additionally I get a lot of positive feedback for doing them.

Here’s to a great year 2015!

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LinksSpy.com – Monthly Income Report November 2014

Welcome to another monthly income report.
You can find all my income reports here: http://www.christophengelhardt.com/income-reports/.

November was a great month and I will be hard pushed to keep my MRR level. I already see some people churn and have to find a way to stop that.

Before I get into the details here are a few things I want you to know about my income reports:

  1. I publish income reports for two reasons: a) Accountability helps me push forward. b) I know that most of us compare ourselves to “famous” people like Patrick McKenzie, Brennan Dunn, Nathan Barry and others. I am no stranger to that and it is hard to feel good comparing yourself to them. Well, compare yourself to me and you’ll feel better instantly 😉
  2. I will only cover what I make from LinksSpy – no consulting, no day job
  3. I am terrible at accounting – so most numbers (especially expenses) are not 100% accurate.
  4. I have an agreement with Nathan Powell of nusii.com that I will stop income reports by the time I hit $1,000,000 annual run rate. According to Nathan that should happen sometime in June 2015 – we’ll have to see about that.

The Numbers

Last Month’s Revenue

In October I had increased my MRR to $593.50 from 22 customers. It was a month of great growth (~ 85% over the previous month), mainly due to a great blog post I had published in September.

At the end of October I attended MicroConf Europe in Prague (I took some notes for you to indulge in) where LinksSpy was promoted by one of the speakers and subsequently ended up on ProductHunt. That drove a load of signups that were still in trial at the end of October.

This Month’s Revenue

Of the 50+ signups “only” 24 ended up converting to paying customers. That conversion rate is slightly lower than what I usually see, but that is to be expected considering the audience. People on ProductHunt like to try out things – that doesn’t mean they actually have use for a service like LinksSpy.

Those new customers brought LinksSpy up to $1392 MRR from 46 customers, which equals a whooping 134% increase in revenue.

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OK, just kidding. But that is fricking amazing! And this time I think all that growth is NOT because of a software bug – yay!

Here’s a nice MRR growth graph taken from FirstOfficer.io:

LinksSpy November MRR growth chart

That looks satisfying 😉

Expenses

Due to the way LinksSpy is set up my costs are really low. It was one of my design goals to keep most things running on Heroku‘s free tier. This is partly because I’m really cheap and – more importantly – because I didn’t know how well LinksSpy would do and I was afraid of catastrophic failure.

Total expenses:

  • $36 to Heroku for database, SSL and Papertrail
  • $53.87 in Stripe fees
  • $49 for Drip
  • $215 for one blog article per week – written by my content marketing genius (this is the average for one month of the weekly rate of $50)
  • $116.92 for Retargeting with Perfect Audience
  • $55 on FacebookAds
  • $5 for email / Google Apps
  • $618.4 for a developer (including hiring process/test project for 2 developers)
  • $5 for a fiverr gig to design a picture for my Facebook ads

If I didn’t miss anything (which I probably did), the total costs were $1,154.19. YAY! The first month I spent more than $1,000…

Profit

For the time being, I don’t plan on making any profit from LinksSpy. I want to focus on growing it as fast and as big as possible, thus I’m re-investing everything back into LinksSpy.

LinksSpy made roughly $235 in profit this month. I already spent that on a new explanatory video for LinksSpy, which should hopefully be ready by christmas.

Progress

I didn’t make a ton of progress in November. At least it didn’t feel like it. But luckily I have my business journal (hat tip to Brennan Dunn), which tells me that I did quite a few things more:

  • I hired a great developer (I think he’s better than me – so he’s a perfect hire)
  • Refactored the backend, so it can handle the load from having 2x more customers
  • Optimized Retargeting campaign: Moved to Facebook Sidebar ads, removing subscribers from target list, added conversion goals
  • Added FAQs to the signup process and improved the design of the process
  • I worked on building two new marketing assets (ultra mega hyper top secret 😉 ) to be released in December/January
  • I added a drip email campaign for users in the trial phase
  • I refactored the data export, which now supports more filters

Optimizing the retargeting campaign lowered the cost per click (CPC) from ~$25 per click to a CPC of just $1.79 – that’s an amazing improvement right there!

I don’t feel like the Facebook advertising is working right now, but I hope to figure this out eventually. I got a great head-start because a friend shared his targeting settings with me.
I am currently promoting the drip email campaign through the Facebook ads, which I think is the right strategy.

The hiring process for my developer took quite a bit of time (It was a 5 step process, including Skype interviews, live coding and test projects). Currently he is adding features to some open source gems I use, but eventually he will be contributing to the main LinksSpy application. He is working for 5 hours a week, which is about as much time as I invest into developing the application.

The marketing assets will hopefully help me to further grow LinksSpy.

What to Focus on Next Month

December is going to be a slow month: Christmas is going to take its toll – which is fine by me. I am looking forward to spending some time with my family and my wife.

I am trying to set up some customer interviews and see what my customers really need/want. I did one in November, which was really amazing and got me started on some ideas, but I need to hear other customers voicing the same problems before I actually go about implementing those ideas.

Additionally, I want to finish my two marketing assets. One is ready to ship as I am typing this report, but I still need to set up the marketing campaign for this.

The same can be said about the second marketing asset: It still needs a lot of work/content creation and I need to figure out which marketing I want to do for this for maximum effect.

My Takeaways

Biggest takeaway: Remarketing on the display network sucks – big time. Facebook sidebar ads work much better for retargeting – at lest their CPC is 1/20 of the display network.

Other than that, I don’t have much insight this month. I just kept on doing a mixture of improving the application and some light marketing. Not enough marketing now that I think about it… I have to focus more on that.

Conclusion

November was out of this world. I thought that October was great, but November just blew that right out of the water.
I learned a few things and did some preparatory work for my marketing. Not bad overall, but nothing too exciting.

I am quite happy with where LinksSpy is right now – to be honest it has exceeded my wildest dreams. At the same time I feel anxious about everything: My guesstimate for churn is around 10-13% (law of small numbers), which means I need to get a lot of new customers to just keep my MRR level. That in turn makes me think I will fail horribly; I will disappoint everyone around me and be ridiculed forever.

Don’t get me wrong: I am grateful for where I am with LinksSpy now. I feel very lucky for having crossed the $1,000 MRR barrier with such ease. But at the same time I have to acknowledge the problems lying ahead of me. I need to find a way to reduce churn and I need to radically improve my marketing.

I have learned a lot – which was immensely fun. Nonetheless, I still have much more to learn. I need to understand my customers better and have to find a way to deliver more value more consistently. So stay tuned, this won’t be the last income report 😉

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LinksSpy.com – Monthly Income Report October 2014

Welcome to the third installment of my monthly income report. After an awful income report in September (for which I got a lot of great feedback & encouragement – Thanks a lot to everyone who reached out!), LinksSpy came back swinging.

Before I get into the details here are a few things I want you to know about my income reports:

  1. I publish income reports for two reasons: a) Accountability helps me push forward. b) I know that most of us compare ourselves to “famous” people like Patrick McKenzie, Brennan Dunn, Nathan Barry and others. I am no stranger to that and it is hard to feel good comparing yourself to them. Well, compare yourself to me and you’ll feel better instantly 😉
  2. I will only cover what I make from LinksSpy – no consulting, no day job
  3. I am terrible at accounting – so most numbers (especially expenses) are not 100% accurate.
  4. I have an agreement with Nathan Powell of nusii.com that I will stop income reports by the time I hit $1,000,000 annual run rate. According to Nathan that should happen sometime in June 2015 – we’ll have to see about that.

The Numbers

Last Month’s Revenue

In September I had increased my MRR to $320 from 16 customers. That was after a correction of $216 MRR – I had accidentally kept charging customers after they had cancelled.

On the plus side, I published a blog post that got quite a bit of attention in early september. That brought me about 5,000 unique visitors and 100+ subscribers to my mailing list.
You can read the full story in my last income report.

This Month’s Revenue

October has been a crazy month for me. I started to see the effects of my blog post about the costs of paid links.
The retargeting didn’t go so well: I spent $25 for just a single click. Not what I had hoped for 🙁

Still a number of people signed up for the trial and converted to paid. This leaves me with 22 paying users – not counting 2 users who have failed charges and need to update their credit card data. The MRR from those 22 users is $593.50 – with the other 2 customers I’d be looking at $644.50 MRR. That is a growth of 83% MRR.

01_october_mrr_growth

Graph taken from FirstOfficer.io (go check that out – it’s an amazing tool!)

 

 

Finally, I went to MicroConf Europe in Prague at the end of October, which resulted in a huge spike of new signups (about 50 by the end of November 3rd). More on that further below.

Expenses

Due to the way LinksSpy is set up my costs are really low. It was one of my design goals to keep most things running on Heroku‘s free tier. This is partly because I’m really cheap and – more importantly – because I didn’t know how well LinksSpy would do and I was afraid of catastrophic failure.

Total expenses:

  • $36 to Heroku for database, SSL and Papertrail
  • $23.80 in Stripe fees
  • $49 for Drip
  • $215 for one blog article per week – written by my content marketing genius (this is the average for one month of the weekly rate of $50)
  • $37.50 for Retargeting with Perfect Audience
  • $5 for email / Google Apps

If I didn’t miss anything (which I probably did), the total costs were $366.30.

Profit

For the time being, I don’t plan on making any profit from LinksSpy. I want to focus on growing it as fast and as big as possible, thus I’m re-investing everything back into LinksSpy.

LinksSpy made a loss of about $400 in September and made a profit of $226.70 in October. That’s pretty cool overall, because it means I got about half the loss from last month back.

Progress

I got quite a few signups from the blog post I published and tried to follow it up with another one on how I bought a link on BuzzFeed. I published it before I felt good about it, which turned out to be a really stupid mistake.
I got hardly any visitors and the few I got were disappointed in the quality. Understandably, because that article adds NO value.

My guess is that most people who signed up during October did so because they went through my drip email campaign. I need to get some hard data on that, but at least 2 of the 6 new customers used a coupon code I gave away at the end of the drip campaign.

I also had two people basically say to me: “I love the data I get out of LinksSpy, but I don’t have the time. Could you do the work?”. I had to say “no” and forward them to existing customers of LinksSpy, which is cool because that is a win-win-win situation. But it also keeps me wondering: Could I automate the link outreach to the point where I provide that service for e.g. $249/mo?

Additionally, I managed to book some reddit ads and they will go live in mid-November. I think I booked $15.84 of inventory in /r/bigseo. We’ll see how that goes.

Furthermore, I started a business journal (hat tip to Brennan Dunn for the idea)). That journal tells me, that I also did this:

  • added two beta features to LinksSpy: an automated email that informs customers about the new links they acquired (as a method to hopefully reduce churn, because it shows LinksSpy’s value) and a link building report that customers use in proposals to win over more clients
  • wrote a 1,600 word article about getting clients to pay on time – just another piece of content marketing

Finally, I went to MicroConf Europe in Prague at the end of October. While the ideas I took away from the talks (full notes here) were worth the ticket alone, the hallway track was amazing. I had such a great time talking with friends – both old and new – that I was heartbroken on wednesday when I had to leave.
The best part is yet to come: My friend Dave Collins was a speaker at MicroConf and added a slide to his presentation promoting LinksSpy (without me knowing, he told me a day before his presentation – THANK YOU, Dave!).
That slide was visible during his whole Q&A session – the better part of 20 minutes. A few people started talking about LinksSpy on Twitter, which piqued the interest of Adii Pienaar. Adii submitted LinksSpy to Product Hunt, where it – thanks to the help of Nathan Barry, Charlie Irish, Brennan Dunn and other MicroConf attendees – rose immediately to the top 10 and stayed there for the rest of the day.
Long story short, just from being on Product Hunt and the buzz (blog posts, news stories and Tweets) LinksSpy had 50+ new signups. They are all in trial right now, but I have some $1,500 MRR in the pipeline waiting to be realized. (nb: That’s almost 3x my current MRR!)

Nathan Barry also suggested to me to reach out personally to anyone who signed up for LinksSpy during that period. I managed to do that for the first 2 days, but I was really stressed about it and have not sent a single email since 🙁
It is a fantastic idea, though and definitely helped me keep people interested in the app. I should pick it up again.

During that phase I had a few bugs – e.g. I destroyed the sorting algorithm for suggestions. That shouldn’t have happened, but man… I am stupid, what can I say?
Luckily, I have exit interviews in the app, so I at least got a bit of qualitative feedback out of the cancellations.

Overall, this month was exceptional. I don’t think I can easily repeat that in November – but that won’t keep me from trying.

What to Focus on Next Month

November will be a mixture of improving the product, talks with customers and more marketing.

On the product side I need to improve the backend to bring down the time it takes to finish new reports and finish the two features currently in beta. I also have a few items on my todo list after MicroConf to improve the website.

Talking to customers I hope to find ways to improve LinksSpy to deliver even more value. I think there might be a way in automating/streamlining the outreach for link building. Anyways, I need to talk to customers and find their pain points.

Furthermore, I need to do more marketing. I bought reddit ads which will go live this month, but I also want to try my luck with Facebook ads. I also want to do more link outreach since that is showing first results.

Lastly, this is my todo list after MicroConf Europe:

WEBSITE

  • add telephone number to marketing websites
  • move trust symbols into container on “Credit card page”
  • move trust symbols closer to CTA on CC page
  • turn “hide” into “X” on campaign#show
  • improve onboarding process (less repetition)
  • remove last step of onboarding process and turn into layover

(Most of the items on this list are due to a UX/UI teardown by Jane Portman)

MARKETING

  • hire VA for editing/publishing blog posts
  • Convert “Paid Link Study” into SlideShare (STARTED)
  • Let koudoku_coupons change views to show the coupons to the user
  • Customize Drip email campaign „confirmation email/page“
  • Facebook sidebar ads (STARTED)
  • Add Facebook sidebar ads to PerfectAudience (DONE)
  • ask customers for testimonials & referrals
  • Onboarding emails: different email campaigns depending on where they are in the onboarding process

DEVELOPMENT

  • hire freelancer (STARTED)
  • add “delete campaign” button for users (DONE)
  • add Customer Happiness Score (CHI)
  • record user events
  • refactor backend for parallel execution (STARTED)

My Takeaways

My big takeaway this month is that it pays off in unexpected ways to have friends like Dave Collins of SoftwarePromotions.com. Without his promotion of LinksSpy I would have never got on Product Hunt and would never had such a huge number of new signups.

Other takeaways are:

  • I need to hire people to help me grow LinksSpy – going at it alone is terribly slow. I already started the hiring process for a part-time developer, but I also need a part-time assistant to help me with various tasks like article editing and social media (if you are interested, send me an email to christoph@[any domain I own])
  • personal emails are huge, but also time-consuming & stressful
  • I am a lucky man for having an understanding wife and a great community & friends that push me me forward

Conclusion

October went extremely well and I can not expect November to be anything like it.

There are a lot of items on my todo list, which should make for a few interesting weeks ahead. My motivation is soaring after MicroConf, hopefully it last for a bit.

Anyways, I’m looking forward to seeing you again next month 🙂

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LinksSpy.com – Monthly Income Report September 2014

Welcome to the second installment of my monthly income report. I nearly quit this after I realized what a horrible mistake I had made with the first income report. I triumphantly announced having doubled my monthly recurring revenue (MRR) – when in fact I had committed an embarrassing blunder.

Before I get into the details here are a few things I want you to know about my income reports:

  1. I publish income reports for two reasons:
    1. Accountability helps me push forward.
    2. I know that most of us compare ourselves to “famous” people like Patrick McKenzie, Brennan Dunn, Nathan Barry and others. I am no stranger to that and it is hard to feel good comparing yourself to them. Well, compare yourself to me and you’ll feel better instantly 😉
  2. I will only cover what I make from LinksSpy – no consulting, no day job
  3. I am terrible at accounting – so most numbers (especially expenses) are not 100% accurate.

The Numbers

Last Month’s Revenue

In August I boasted about having doubled my MRR to $480 from 21 customers – only I didn’t. I fucked up royally.

The short version is that I had 2 different ways for users to cancel their LinksSpy subscription. Unfortunately, I only knew about one of them. Worse yet, most people cancelled using the way that I was unaware of. This also happened to delete any traces of their account in my database WITHOUT cancelling their Stripe subscription. In essence, people could cancel their account and I would keep charging them.

After I learned about this blunder, I immediately searched for every (previous) customer who had been affected by this. I cancelled their subscription and refunded the last payment – together with an email explaining my error.

This has cost me 6 customers and $216 MRR. In fact, I only had $273 MRR from 15 customers in August. A modest increase over July, but not exactly great.

This Month’s Revenue

In September I increased MRR to $320 from 16 customers. Small steps… small steps…

Expenses

Due to the way LinksSpy is set up my costs are really low. It was one of my design goals to keep most things running on Heroku‘s free tier. This is partly because I’m really cheap and – more importantly – because I didn’t know how well LinksSpy would do and I was afraid of catastrophic failure.

Thus, I only pay $9/mo for the hobbyist database plan and $20/mo for the SSL endpoint.

Other expenses:

  • $15.80 in Stripe fees
  • $49 for Drip
  • $230 for one blog article per week – written by my content marketing genius
  • $100 for design work for a blog article I wrote

If I didn’t miss anything (which I probably did), the total costs were $423.80.

Profit

For the time being, I don’t plan on making any profit from LinksSpy. I want to focus on growing it as fast and as big as possible, thus I’m re-investing everything back into LinksSpy.

LinksSpy operated at a net loss of about $100 in september and I refunded $295. That leaves me some $400 short for september – nothing to worry about.

My Takeaways

The biggest takeaway for me is that messing up the payments and subsequently apologizing to your customers is painfully humbling. I never want to do this again.

Another “takeaway” this month is that content marketing drives quite a few people to your blog posts, but it does not bring in new customers immediately. If you are doing content marketing, you commit yourself long term.

Progress

The biggest thing I managed to get done this month was publishing an amazing in-depth research article about the prices of paid links.
It managed to briefly climb to the front page of Hacker News and was quite popular on /r/bigseo – accounting for 1,403 visits combined.
It was shared by some “famous” people in the SEO industry and reached an audience of about 300,000 on Twitter – which sent a grand-total of 268 visitors.
It also made it into the Moz Top 10 newsletter, which drove 4,578 people to my blog.

Again this shows me that email marketing is insanely effective.

The outcome of that blog post has been fantastic: I have about 100 new subscribers to my drip email campaign. I also enhanced the drip email campaign by adding another email that is more of a hard sell – something that was previously missing from the drip campaign altogether.

Furthermore, with the influx of new visitors I finally was able to start retargeting via PerfectAudience. I had the banner ad done months ago, but never had enough people tagged. I’m sending them to a dedicated landing page and trying to sign them up for my email list.

Additionally, I finally re-designed parts of the LinksSpy homepage to make it more appealing. I also integrated HireFire into LinksSpy, which will dynamically spin up/tear down Heroku worker instances and help to bring new reports into the hands of my customers faster.

What to Focus on Next Month

Same as the last few months: More marketing. I have ordered more articles (1 per week instead of 3 per month) from Ryan, my content marketing genius.
We are also going to implement a better process (using Trello) for publishing new blog posts. This will include adding pictures to all posts – something we haven’t done in the past – and publishing all new articles to a few places such as reddit, inbound.org and others.

In addition, I am already working on a follow-up post to the last one. This one will be about how buying a link on BuzzFeed can affect your search engine rankings. I hope this post will have a greater reach than the previous.

I will also start sending out newsletters to my mailing list. I will probably use the new content for those newsletters as well.

Conclusion

September was a month of mixed feelings: The bug was horrible, but on the other hand my article was great.

LinksSpy is improving in small, but steady, steps and revenue is also increasing. I’ve got more than enough to get on with in October, not least among them attending MicroConf Europe (If you are coming, don’t be shy – say “Hi”!)

I’m looking forward to seeing you again next month 🙂

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LinksSpy.com – Monthly Income Report August 2014

I wondered for a long time whether I wanted to share my income publicly. I have done it in the past – either on the podcast I am co-hosting or in the Micropreneur Academy. But these places are either a closed community (the Academy) or no one really listens to them anyways (my podcast 🙂 ). Publishing it on the blog for the world to see, and for Google to index, is a whole different ball game.

But people like Pat Flynn, Matthew Woodward and Josh Pigford as well as companies like Moz and Buffer convinced me to do this.

I write this report for people like myself: People who are building a product and are struggling with the first steps of the journey. Not with the technology, but with actually bringing it to market and growing it.
I write it for reactions like this one from Nathan Powell:

Hey Christoph.
It’s so nice to read about a “normal” launch.
Encouraging even. Keep it up, and here’s to 2022!

In short: I write this report for YOU. I want to encourage you to travel this (hard & stony) road. It’s immensely fun.

What is Covered in This Report

I will only cover what I make from LinksSpy; if you want to know what LinksSpy is, then here’s an article on how I started. This means, that I do not include money earned from consulting/freelancing nor what I make in my day job.

I will try to provide detailed information on my expenses as well, but my systems for accounting are lacking in precision (read: “I suck at keeping track of all the invoices”). So the numbers could be off by a bit.

Looking Back – The History of LinksSpy

I launched (and started billing customers) in May 2014 after a long private beta. I started out with 10 customers and $190 in Monthly Recurring Revenue (MRR) after a few days.

In the months after that I saw slight improvements from new signups. I don’t get many visitors to the website (yet), so there isn’t much volume going into the funnel.

In June my revenue went up to $235 from 13 customers. Than it was $255 from 15 customers in July. On August 1st it was down to $235 again – this time from 16 customers (I lost one customer with $40 MRR, but gained 2 customers at $10/mo each).

The Numbers

Revenue in August

August has been the most successful month so far in terms of MRR growth: I more than doubled MRR to $489 from 21 customers. I’ll talk about how I did this in a bit, but first focus on the numbers.

In total I collected about $478 in payments from my customers.
My Stripe account is in Euros (€) and I used today’s (14.09.2014) exchange rate to calculate the dollar amount – so this is a bit off.

Expenses

Due to the way LinksSpy is set up my costs are really low. It was one of my design goals to keep most things running on Heroku‘s free tier. This is partly because I’m really cheap and – more importantly – because I didn’t know how well LinksSpy would do and I was afraid of catastrophic failure.

Thus, I only pay $9/mo for the hobbyist database plan and $20/mo for the SSL endpoint.

Other expenses:

  • $20.48 in Stripe fees
  • $49 for Drip
  • $166.65 for 3 blog articles written by my content marketing genius
  • $20 for design work for a blog article I wrote

If I didn’t miss anything (which I probably did), the total costs were $435.13.

Profit

For the time being, I don’t plan on making any profit from LinksSpy. I want to focus on growing it as fast and as big as possible, thus I’m re-investing everything back into LinksSpy.

However, I didn’t spend all the moneyz in August and so I made a small profit of $42.87. Rest assured that I will find a way to spend that money in September 🙂

My Takeaways

So what caused this steep increase in MRR?
The single biggest factor was/is that i doubled my prices for NEW signups – I grandfathered all my existing customers in at their old rates.
Yeah, you read that right: I DOUBLED prices. Insane – isn’t it?

That – of course – wasn’t my idea, but rather Patrick McKenzie’s idea of “Charge.More.”. I think it was at MicroConf Las Vegas in 2013 where he laid out a simple enough rule: “Double your prices; watch conversion rate; repeat until conversion rate drops significantly”

That rule is REALLY easy. It makes sense intuitively: As long as people sign up with (more or less) the same frequency, they are seeing the value in your product.
The only problem with this is: You have to overcome internal objections to actually double prices. It is hard; You have all the worries in your head that people will hate you for it.

Fact is: No one will hate you for it. Most people won’t even realize that you doubled prices. Plus, you can always just go back to your old pricing, if the need arises.

Another contributing factor is that I randomly threw money at the problem: I invested $100 in StumbleUpon and $50 in Twitter advertisements.
Of course I didn’t set up ANY analytics AND/OR tracking (that’s for cowards, obviously), so I don’t know which (whether?) of the two ads brought in customers. Well, there’s always room for improvement – in this case there is a LOT.

Overall, I think that the biggest factor was that I finally focused on marketing, instead of coding away on LinksSpy.

Progress in August

Despite being away on holiday for two weeks in August, I managed to finish quite a few things:

  • moved the LinksSpy blog to http://blog.linksspy.com and the application to www.linksspy.com
  • I finished writing a really cool blog post about the costs of paid links – I’ll talk more about the impact of that in my September report
  • numerous small improvements in the application itself – among them lifecycle emails. E.g. users who entered their email address, but didn’t enter credit card details (i.e. they churned during signup) now get an email the following day which reminds them to finish the signup process

What to Focus on Next Month

I’ll try and focus more on marketing again. After all, that’s what will get me new customers. Despite all my vows to do more, I still suck at actually doing it.

Conclusion

August was an incredible month for me. It really fueled my motivation for LinksSpy. That said, you can see for yourself from the numbers above that I am no where near making a living off of LinksSpy.
It is easy to loose motivation when you compare yourself to the likes of Brennan Dunn, Nathan Barry, Patrick McKenzie, Mike Taber et al., but if I look at things with a bit of realism, I feel like I’m not doing that bad after all.

Oh.. and my goal of making enough money out of LinksSpy by 2022 suddenly became a lot more realistic 😉

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