The Power of Quizzes for Lead Generation with Josh Haynam Co-Founder of Interact

From Silicon Valley to all around the world, I meet with startup founders to hear their powerful stories of failure, obstacles, and success. I'm your host, Blue Baird, and this is the Cult of Startup Podcast. Hello there, Wild Ones, and welcome to the latest episode of the Cult of Startup Podcast, where I interview startup founders from around the world to discover what they did to find success and how you can apply it directly to your startup. And today's guest is Josh Hainem, co-founder of Interact, an online lead generation software.

But to more accurately describe it, we have all taken a survey on Facebook at some point in time. Whether it was to find out which starware's character we would identify the most with, or to find out whether or not we've survived the next season of Game of Thrones, this is exactly the service that Interact provides. So I hope you all enjoy this interview as much as I did, and as always, thank you for listening. How's it going, man?

I'm doing super well. Thanks for having me on the show. No problem, man. So I want to hear about your company.

What do you guys do? Yeah, so I'll give you the party version, which is what I tell people when they ask me what I do at parties. Basically, we have a software for making quizzes like the ones that you see on Facebook. So literally those quizzes that are something like what kind of coffee are you, or which kind of shrimp are you, or what type of business owner are you, all that kind of stuff.

But we sell it to companies who want to make their own quizzes for their own brands in order to do marketing to reach more people, and also draw those people into their companies. So you can use our quizzes to collect contact information from the people who take the quizzes, and then follow up with them based on their quiz outcomes. So for example, if you're doing a what kind of coffee are you quiz, you could follow up with people differently if they got Colombian coffee versus Ethiopian, and then you could send them a series of emails that's all personalized to who they actually are. So in a nutshell, that is what we do.

Hello, everybody. Pitched. Yeah. You've done that a couple of times?

I'm sure. I love this concept where I feel like most people don't recognize that there's a business running behind something that they're doing online, like taking a quiz through Facebook, let's say. That's kind of very, it's super unique, but me as a consumer, I want to be cognizant of like, oh, this is actually going to be retargeting to me. Yeah, exactly.

That's like one of two reactions I get. It's either, oh, I didn't know that was a business, or oh, that seems like a silly business. Those are the two things that people say to me. And it's like, it makes sense though, because you don't think of what's behind things.

And I think that's actually where some of the biggest opportunities lie because everyone knows about quizzes. And it's hilarious because every time I talk to somebody about this, they sort of sheepishly admit to me that they love taking quizzes. And I'm just like, I know you do. I know I can see the stats.

You're not the only one. But they seem to think that it's this big secret that they love taking these things, which is also another kind of, it's almost in the same vein where it's like, you see quizzes everywhere, you don't really think that there's a business behind it. You also take quizzes all the time. You don't think about the fact that there's a business behind it.

And both of those give us a huge opportunity. Yeah, super unique. I want to say sort of niche to some degree. Yeah, it certainly is.

And it's a lot less so now than it was when we first started four years ago. There was nobody really interested in this. We were selling it as a lead generation tool. And then it happened to be a quiz.

There was no, we weren't pitching the quiz part of it. And now things have shifted a little bit to where there are people that are interested in doing quizzes as a lead generation tool still primarily, but it's shifted a little bit. And it's growing very quickly though, which is the promising part. So it's still small, but it's getting there.

Yeah. And this is the common thing that I've seen, at least in reading about marketing, that lead generation for companies needs to get more crafty. If that's the appropriate word for it, that you can't just assume that, okay, I'll take this demographic information, but that you can actually throw a tool out there or something like that to actually collect the right information from the consumer at the end. Yeah, I think there's that where people are tired of getting blasted different things.

You know, I'm on calls with a lot of big companies and they know that people are getting tired of this stuff. They're sending out the same things over and over again. The response rates and the opt-in rates and the sales are going down. They just don't know what else to do.

And I think that's where a quiz is a very simple change that you can make to implement to, you know, collect contact information, to collect leads, to follow up to people in a more personalized way. You just leap. You're not jumping straight to Amazon status, but you're also not just doing the same thing that you've always been doing. And I think companies really need baby stuff.

They need something small they can start with because they are so entrenched in sending out blast emails and sending out mailers and sending out e-books that they're trying to give people a download. So they need something that's a small shift and that's what quizzes can represent. Yeah. So do big or small and big companies use this kind of product or is there a certain target market that you're going after?

Yeah, we work with the whole gambit of businesses from individual business owners all the way up to we work with the American Red Cross, United Nations, Home Depot, a lot of massive, massive organizations. Global corporations are sweet spot is kind of in the middle. So not super small companies, but also not giant ones. And we work with 30,000 companies now.

So we work with a ton of people, but they're mostly in kind of the not just getting started space, but also not like a giant corporation. Yeah, for sure. And I can see this being super useful for a handful of clients that I have. So I want this in like the Western fashion space and it'd be great to send a quiz out to everybody, collect a bunch of information on it and know because she does like tech stuff or courses, but she also has this entire like fashion line.

And those are separate consumers. So being able to sort of parse those out would be super useful for our business. Yeah, we see a ton of style quizzes come through. So what's your style?

What's your jewelry style? What's your makeup style? What's your Western wear style? For example, and you basically filter people into different categories and then you can start sending them emails with selections of products that are based on their particular personality.

And then you can also tag them using Facebook ads through our system and then start showing them ads that are based on their particular style. So a really easy way to just kind of personalize your entire offering and just let people choose from the things that actually apply to them. Oh, that's right. So you can integrate with like the Facebook pixel and all their analytics through your platforms?

Yeah, yeah. That's badass. Yeah, it's really cool. All right.

So I'm taking talking about your company and I want to come back around to it. But let's take a little bit of a historical approach to you. So you grew up in the Central Valley. Sounds like you, at least from our previous conversation, you were sort of a serial entrepreneur beforehand, but you kind of stumbled into that to my knowledge.

Yeah. So I grew up in the Central Valley, which most people don't know what that is. So I'll give it some background here. The Central Valley is like the Midwest that's in California.

It's in California. Yeah, it's in California, but some of my best friends are from the Midwest. And when we share childhood stories, it's like we grew up in the same place. So it's two hours from San Francisco, but it's a world apart.

And it's farm country. It's kind of like the dust bowl in some sense, like a lot of just really wide, spread out places. People live far apart. That kind of stuff.

So that's where I grew up. And when I was kind of coming to it, coming of age 14, 15 years old, we were right in the middle of that recession back in 2007, 2008, where there was the housing thing and people were being sold homes that couldn't afford. And the Central Valley was prime target for those subprime mortgages that all failed. Yeah.

A bunch of people went bankrupt, a ton of evictions, and it was just a mess. So I'm 15 years old going around trying to find my first job. I grew up very poor. So if I wanted to do anything, I needed to make my own money and I tried to find a job.

So I applied everywhere to Little Caesars and Burger King and Pizza Hut and Donald's and Starbucks and everything I could think of and didn't get a single hit. So I'm just trying to get a basic job, nothing fancy and just zero interest from anyone, which was an interesting conundrum to be in. And so at that point, I had to figure out what I wanted to do. And I'd always been a tinker.

I was always the one that was making random stuff in my backyard. I built a teeter totter when I was like 10 or 11 years old out of tires and some giant boards. I was always building these incredibly elaborate bike ramps and then going off of them and crashing. And it was just a smorgasbord of conundrum of just a mess in my backyard.

I don't know how I'm going to put it, but anyways, that's what I had always done. So I was really good at just creating something out of nothing, like taking boards and making a teeter totter. And so I figured, why don't I just create myself a job? And I thought about what I knew how to do.

And pretty much the only thing I knew how to do was long work. So I had installed a sprinkler system in my own backyard. I had laid sod, which is rules of grass in my own backyard. So I knew how to do that.

And I knew that that was something that people did for work. So me and my best friend made some flyers. We set up a Craigslist ad and we said, hey, we know how to do a sprinkler system since solid. And we're cheap and we're good at what we do.

We'll be on the cost of everybody else. Exactly. We tried not to say that. By that point, I was 15 and I already had a beard, which was fun.

So I tried to act a lot older and we ended up getting a hit from a guy and we went out to check out the job. And it turned out when this guy had installed a beach in his backyard, which is hilarious because Turlock is 100 miles from the water and it's 110 degrees every day in the summer. So you don't want to go outside. But his kid wanted it.

So he installed it and basically they installed the beach by just dropping eight tons of sand into their backyard. And then his kid, surprise, surprised that he didn't want to beach anymore. And now he wanted grass. So he was like, hey, I have this job.

I need somebody to remove eight tons of sand and then install a sprinkler system in grass. And I was like, cool, $1,000. And of course he said, yes, because that's the most stupidly low price ever. But we got the job and we ended up finding somebody that wanted sand that was like a mile away.

And then for three or four days, we took a wheelbarrow, filled it up with sand, went in the back of my truck, drove a mile, unloaded the sand, went back. Something along the lines of 40 or 50 of these trips in 110 degree weather in the middle of Central Valley. Oh, and side note, side note, this guy is an MMA fighter. So he would actually sit there in a lawn chair watching us.

It's huge, tatted up, ripped MMA fighter just watching us to make sure we don't mess up. Hard to mess up moving sand, I think. Yeah, that part was hard to mess up. Then we get to the part where we're actually doing the more meticulous stuff, like making sure the sprinklers are all set up properly.

And the grass is all aligned. And if you lay sod wrong, it doesn't grow right. So you got to make sure it's all lined up. And so we're exhausted after three days of moving sand.

And then you also got to move the sod, which is just 60 pound rolls of grass that you carry in. It's this thick mud that gets over, like all over your arms and you can almost never get it off. So that was what we were doing. But we finished the job in about a week.

And I remember sitting there at a, all you can eat pizza dinner, which is what you do after you finish a week of how it stands. And just looking at my two friends that had hired and feeling this deep sense of accomplishment, we had just installed this lawn. We removed a beach. And it was a great, great feeling.

So much more so than even the feeling of making money. I would have made more money had I gotten the job at Burger King in that amount of time. But overall, it was just such an amazing feeling. And that's when I really got hooked on just being my own boss and pitching jobs and going out and doing things.

So I did multiple jobs like that. I wasn't a turt. We did more, no more beaches, luckily. But in the central valley, yeah, no more beaches in the central valley.

But we did a lot more lawns. And I remember a lot more super hot days, ridiculous sunburns, like the most insane sunburns. Did I ever imagine working in the hot sun for 12 hours. And it's yeah, like just crazy stuff.

So, but yeah, we kept doing that. I ran that business called at J's Landscaping Services. And I got in pitch jobs and we'd installed lawns and did that for a while. And then I actually threw my back out when I was 16 years old.

So 16 years old and had moved too much sand. And you're old? You're old? You're old?

You're old? You're old? You're old? You feel like a 50 year old?

Basically, yeah. It was not good. And I had solved the initial problem of I need to create a job, but then I ran into a new problem. And I happened to discover something, which was that I, as soon as I started making money, of course, I started buying speakers for my truck because that's what you do when you're a teenager and you want loud music.

So I had bought these speakers, but I wanted to buy new ones. So I was looking to sell the old ones and I had them up on Craigslist and somebody hit me up and they were like, hey, I'll trade you my laptop for your speakers. And I didn't know much about it, but I figured maybe I can sell the laptop. So I went and I traded them and I had bought these speakers for 80 bucks.

I traded them for the laptop and then I looked up the laptop online. It was worth $400. And so I listed the laptop and sold it for $400 and I had made $320 doing nothing. And I was like, this is way better than moving sand.

So I started looking around at other places where I could find laptops that were underpriced for sale or maybe there was something slightly wrong with them and I taught myself how to fix software problems and viruses and things like that so that if somebody had a virus and they were selling their laptop super cheap because it didn't work anymore, I could buy it, fix it and resell it. And I started doing that a lot, like seven to eight times a week and the profit margins were 1 to $200 per laptop. So I built this business up really quickly to the point where it was making $1000 plus dollars a week in pure cash. It's pretty good as a high school student.

Yeah, I'm extremely good at high school. 17 years old, raking in cash. I used to keep it in rolls in my desk and I have others. I've learned others who are 10 years younger than me.

So they were six and they'd sit on my bedroom floor counting rolls of $100 pills and just cover the floor. Most hilarious picture ever to... The stupid things you do when you're young. I wouldn't go out and take $4,000 dollars on my account and I don't know if those just look at them on my floor.

Yeah, right. Much less spread them all over two or six year olds to play with and possibly lose. It was so funny. So that's what I was doing.

Things got good for a while. I drove a late model Mercedes coupe that I had bought in cash to my high school graduation. So 17 and a half driving. It's like ridiculous Mercedes car.

So that was my second foray into it and it went really well. And I also built up a network of other high school students who were slaying laptops for me. So there was this whole network of just completely legal network, but it was kind of like the drug trade, but it was just selling laptops. So that was my second thing.

It got really, really into it. It was awesome. I loved the adventure of doing all that. Kept running it through the end of high school the summer after.

Then I went to college, went down to UCLA and tried to keep running the same company in a bigger market. There was a lot of opportunity. And I remember I was so hooked on it. I would walk out of class if I got a call and just leave.

And I figured I could do that because that's what I did in high school. I just would just leave. I had a deal and I could still get by. I was in a whole other world and I was blindsided by it.

So I failed all three of my classes, my first quarter in school and was on the academic probation list after graduating second in my class from high school. I stopped to drop out of college after three months. So I feel like teachers, a handful of students who were really good in high school that they are human still. Yeah, you basically very quickly come back down to earth.

I would literally never study in high school. I had the running joke that I left my backpack in my truck for three months. I never actually did school and I missed 52 days of school my senior year because I was working and it was fine. But then college was a whole other deal.

And I was flunking out. So I made the choice to commit to it and stop running the company and very quickly learn what that means when you go from making $1,000 a week down to nothing which is that you can't drive in Mercedes anymore and you can't have all the things that used to have. So that was a harsh reality. But I reinvested back in school and got back up to speed on that.

And then within that kind of break period I met Matt who is my co-founder of Interact now and we both had entrepreneurial ambitions but weren't working on anything. So we banded together and started selling website projects. So we just go page people on building a website just like I used to pitch lawns but now it was websites and it worked okay. So we get people in.

We do the website and I knew how to do some online marketing stuff based on my experience with the whole computer thing. And we just kind of do a whole immersive experience. It was okay but it was very transactional. I knew at that point this was my third foray into something and I wanted to stop doing these transactional businesses where you put some effort in, you get something out.

I wanted to do, you put effort in and you get exponential results. So I was always looking for the next type of thing and when we were building these websites all that anybody cared about was how many new contacts they got. So we built a whole website and then they would just ask us how many new subscribers they got and we were always frustrated by it because we would show them all the cool things that we had made and they didn't care. They just wanted to know how many new names they got.

We were paying attention to that. It was frustrating. And then one of our clients who is a sales consultant, he runs workshops and things like that for companies like Dropbox and CA Technologies and JUJISM sales. So he had a website that we built for him and he requested that we make him a quiz and the quiz was what's your sales personality.

And then at the end of the quiz after people answered the questions they're prompted to put in an email address in order to see the results and he wanted it connected up to his A-Weberless which is what he used for email marketing. And so we thought, all right, that's kind of a dumb idea. Like here old guy, you don't know what's going on. And we built it and it took us a few weeks and we put it on this website.

And the websites we had built before, so we do the whole experience, would convert about 1% on average. So one out of 100, there's one convert. Then we put up this quiz and we made it a dedicated page that we'd sent traffic to directly. And 75% of the people who went to that page would opt in after they started taking the quiz.

They're like, that's ridiculous. It's so stupid. How can this be the solution to this problem? It doesn't make sense.

So the likelihood of them actually giving you their email address just on a pop up from a quiz that we were saying? Yeah, when they start taking the quiz. So 75% started taking the quiz. So if you're sending traffic directly to the quiz, 75% opt in as opposed to just a generic website that we would build 1%.

So it solved this entire massive problem. We were charging people 30 grand overall to build their entire website and do marketing and all that kind of stuff. And that would convert to 1%. And then there was this silly quiz converted to 75 and it was just ridiculous to us.

So it was it was ridiculous enough to where I thought, all right, what else could we do with this? I started pitching it to people as its own thing, didn't really get any traction. I tried selling it on Upwork to see if anybody was interested in having a quiz bill for them or if there was any job postings for that. We got a couple.

They'd pay us a few hundred dollars to build them a quiz. It was not worth it economically. But I still was hanging on to it because it was just such a good idea for solving this massive problem. So we started building on the side a platform for making quizzes.

I started pitching it to people through email bloggers and things like that. That went pretty slow. We were in our last year of college at this point, so senior year of college. So we were kind of building the website to have the quiz builder come through.

We were kind of pitching people. None of it was really working that well. So I started writing blog content just in general to try to get people interested in our blog. We didn't have a product yet.

So I started writing very basic articles to kind of just build up some presence. We started to get some backlinks using that, which was helpful because we got some exposure. And then I started writing very specific articles about how to use quizzes for lead generation. And they were super specific.

So how to use quizzes to get more leads for your sales business blog. That was the title. Very specific too. So specific.

So specific. So there were some articles to kind of just get a exposure and then some that were super, super specific. And all this time in the background, Matt was building up the platform to make it a little bit better here and there. And then we finally got connected to MailChimp and Aweber.

So you could actually build up your list using the quizzes. And that all kind of came together after a short 12 months of trying to get it started. So I wrote about 100 articles and Matt was working on a platform 12 months and then about 12 months in just a couple months before we graduated college. We actually got somebody to sign up and pay for interact quiz builder.

And then we got another one. And we got five the first month and then we got 20 the second month. And then we graduated college. And we were like, let's just go for it.

Yeah. I got to college. And now we're trying to know. Yeah, exactly.

And that was June 2014. And then since then we have just grown like crazy. Well, actually the first couple of years we didn't grow much. And then this year we'd be like crazy.

So I want to dive into each of those intricacies of the pros and cons of growing a business while in school and all that kind of stuff. But I want to trace back to one thing that you were talking about earlier, which was about the whole entire lawn care business. Just something that, and I think we could get a solid discussion about this. Recently I was listening to James Alcher's podcast and he had Remit City on there.

And he specifically talked about, think about the things that you already pay for right now. You know, there are services out there like a haircut, your car, oil being changed, all that kind of stuff that having that mindset of going, hey, there's already services I pay for and going like it also do that as well is an easy way to start a business. And I just want to sort of hear your thoughts on how somebody comes up with a business idea. I think that's good advice for starting a business.

If you're just, if you just want to start a business, right? Because if you just want to start a company, then think about, yeah, the things that you do pay for. What are the things that have a giant market that everyone does? And those are all good examples, you know, well, not in cities, but in the countryside or this, where everybody pays to get their lawn mode, everybody pays to get their lawn installed, everybody pays to get haircuts, everybody pays to get coffee, that kind of stuff.

So those are all business ideas that will always be there. Now on the other hand, if you're going to invent a new business, which is what we've done with N-R-Act before we existed, there was no quiz builder for marketing. So when we went out and pitched it, it wasn't like, hey, we have a better version of a lawn care business. We have a better, it wasn't like, hey, we have a better version of a quiz maker.

There was no quiz maker. And I think in that case, where you're actually trying to solve a problem, but in doing so create a company and an industry that doesn't exist yet, what you have to do is immerse yourself into the world that you want to be working in. So in our case, we immerse ourselves into the website and the marketing world. And we identified a problem, the problem being everybody wants more contacts.

And then we stumbled upon by working hard, which goes back to that quote of luck comes to the people that tried the hardest. So you tried the hardest in some industry, and eventually you're going to identify what are the problems of that industry. And then if you really immerse yourself in it, you're going to naturally come up with solutions to those problems. And since you've already been in that industry, you know what the actual problem is and that the solution is viable.

And then you can create a product to implement that solution. So that's actually what I would say is that you kind of have to be present to know what's going on. And then you can be, if you're going after an existing industry, because you obviously live life and you know what's happening. But if you're looking to solve a problem in an industry that you may not always be a part of, you kind of have to go live in that world for a little while and see what the problems are.

I think that's a great piece of advice. And that's something that I've heard from numerous guests is that oftentimes they will work in a specific industry. So for you, it was website development and kind of get a better understanding of the ins and outs of what the needs of your, let's say, clients are. And then you realize, oh, there's this tool that all of them could use and it doesn't exist.

Well, we should make it exist. Yeah. Exactly. And then you can interact, I called a bunch of marketing experts and asked them point blank, do you know of a tool that does quizzes for list building and none of them could point to us.

A few of them could point to, hey, I know of a website that does that, but the website had built it themselves just like we had with our client. So there was nothing that could solve that problem. I think that's super interesting. I love how you guys totally kind of stumbled into it.

So like, oh, you read the moment, like, we should just do this. I actually recently had a client where we're building a tool for them and I did a bunch of market research and I realized that this tool only exists in one other facet and there's all these businesses that would be willing to pay for it. Why doesn't anyone do this? So I'm going to take it around and go, okay, well, I can, you know, cookie cutter this out, throw it out there as a software as a service.

You know, and if I get a couple hundred subscribers, you know, paying $50 a month, that's a hell of a business right there. Yeah. Exactly. Exactly.

It's easier to build one thing and sell a thousand times than it is to build a thousand things and sell it a thousand times. Absolutely. That's absolutely it. So I want to talk just a little bit about that because one thing that you mentioned a little bit earlier is that you always wish that you had spent more time growing with your two previous businesses rather than just paying yourself.

So what are some of your thoughts around that advice that you'd probably get to a startup? Yeah. So I mean, with both of those businesses, there was a fundamental problem with the business model and also a fundamental problem with the way that I was treating them. So the fundamental problem with the business model was that they were all transactional in that if you want to make more money, you've got it in some more lawns.

If you want to make more money, you've got to sell more laptops and selling more laptops involves time and effort. It's not like you can make one software and all of a sudden a thousand people can use it and it's still the same software. So that was the fundamental problem with the model. But the fundamental problem with myself at that time was that I was just trying to pull as much as I could out of it in the short run, not thinking about the longer run.

So for example, I always thought about with the laptop business, if I had just invested more in a network of people who could go out and find the deals for me, so source deals, kind of similar to what you'd call lead generation now for like a sales team, I would have been able to build up to something bigger. What I did instead was I always pull out the profits whenever I make a deal and not invest in those other people in that network and hiring people and that kind of stuff. And I think I got myself into a trap and I still have a tendency to do this where I put myself in the place where I was the only one who knew how to do the most important aspects of the job. And there's a lot wrapped up in there.

There's arrogance, there is an unwillingness to trust others, there is an unwillingness to invest in others and what I should have done and what I try to do as much as possible now when the current business is invest in really smart people and let them do the important things and you have to let go and you have to just kind of hand off the keys to them and let them go for it. And that's really a huge part of what's propelled us to grow massively bigger with this company than either of my other two because I finally let other people in and let them handle a lot of the really important aspects and didn't just pull out all the profits from the start. It was all, it was constantly, you know, who can we get to come in and work on this. So that's kind of what I meant by that.

And I think this is sort of a rite of passage that a lot of founders hopefully have to go through. So if they're growing their business, they're going to have to learn to let go of aspects that they're currently controlling. And it's really hard to do that. Yeah, it's really hard.

And then it becomes dually hard when you do it wrong, which pretty much everybody tends to do. So you can do it wrong by hiring the wrong people. And I've done that where I've hired people to take over responsibilities and they're simply not capable of it. And then you start to guess yourself because you're like, well, I tried to do the right thing by hiring and it didn't work.

So of course, that means I must be the only one that can do this. That's not true, but you did it wrong by hiring the wrong people. And then you can also do it wrong by not actually knowing what's working. So if I'm doing four things and I think that two of them are the important things that are actually driving business growth and I hand those off and I hire somebody to do those two things, but then we're not growing more because I had that person and it's like, well, shoot, they must not be good.

But in reality, I wasn't being very clear about what it was. It was actually driving the growth and handing off those things. So now before I package anything up and hand it off, I make sure that I know from the numbers that that role or that responsibility is actually very pivotal to what we're doing. And if we do more of it, we'll grow more.

So those are two ways that you can mess up, handing things off that come back and kind of haunt you. I love this. And how do you determine what your next hire should be? And I'll just say for my personal background, it's, okay, when everybody sort of max out their tasks that they can complete or work it can do and there becomes enough work within a specific category that you could formulate a new position.

But I haven't yet done that. Really? I've had two or three people who work for me but they're really sort of here nor there kind of stuff, but a full time employee is a significant investment in figuring out all the things that they need to do. How have you, is there any sort of formula or advice that you'd give to somebody to do that?

Yeah. Well, first of all, before I give my advice, I will say that I messed this up and show it many ways before coming to the current process and the current process is not perfect. We're now in a mode where we fully believe that we will win some and we'll lose some and we learn from both and both are actually okay in terms of hiring. So we've come to terms with the fact that we're not perfect at it still.

But the current framework for how we do things and how we figure out that we need to hire is that not only is there, like you said, everybody's maxed out and there's more that needs to be done, but also there is a very repeatable process that we know works and that process is the foundation of the new hire. And we only hire people who are expected to take that process and run with it. So they're not going to just keep doing that same thing. They're going to improve on it and implement new stuff.

But we have to have a process in place before we hire somebody. So for example, our latest hire was on our partner program, which is basically where we connect with other bloggers and things like that. And there was a very clear process in place for how we connect with bloggers, what we do when we work with them, how all that works. And it was documented, like actually documented is eight or nine pages of a Google Doc that walks through exactly what you do.

And she was a great hire. So she's implemented a whole new system already and overwritten all that stuff. But it started with that process that we knew contributed to our business growth. And so as long as that's a good person that you hire, they're going to be able to jump right in and hit the ground running.

And then as long as they are innovating, they'll also improve the process in the long run. So it has to be a visible need. Everybody has to be maxed out. And then there also has to be a process in place that needs to be filled.

And then taking it a step further, in terms of the person that we hire, we have to be confident they're going to exponentially improve our team overall, not just be somebody who can do a job, but actually improve our overall team. So that's a whole other aspect of hiring. That seems to be like the hardest thing to gauge. Very difficult, very difficult.

And we're still not great at it. Our process now is we have a skills challenge everybody has to do when they're applying. And then we have decided that we're not bringing anybody on who doesn't get a unanimous vote to join from a cultural perspective, which kind of helps make sure that it has to be something great if we're going to bring them on. Because for somebody to get a vote from any individual on our team, they have to be impressive in all these different ways because our team is very different, very diverse.

And so we have those two things in place, but it's still not perfect. That's exactly how Amazon did it in the early days. I had a previous guest who was the eighth employee there. And he talked all about their hiring practices.

And it was unanimous vote for anybody new. Of course, you get to do that anymore because they're from huge. But at the very beginning, when they were 40 employees, those who were determining that it had to be unanimous. If there was one person off, they wouldn't hire them.

Yeah. And I love those stories of Jeff and that small team in the garage and I've read a few of them and their pizza rule as well. The team should only be the size of two pizzas. Should be able to split two pizzas between the team.

And I like that because I love pizza. But anyways, I think they did an amazing job from a cultural perspective. And it's showing now years down the line because they continue to innovate really nobody else that I've seen because I just think that they brought in good people. So when you will go back to the historical stuff, so you finish school and you launch this business and it sounds like within three to four years, you really started seeing some net positive results.

Did you say in LA, what sounds like in the Bay Area now? Did you decide to move? What was that criteria decision process that you had to go through with your co-founder? Yeah.

So I moved up here and he stayed in LA. The reason that I wanted to move up here was to hire talented people. I knew how important people are. And at this point, it's panned out.

And without our team, we would not be growing at the pace we are where we are. So it totally worked out the first couple of years. It was not rocky, but that wasn't panned out because we weren't hiring anyone. So it was a little bit of a challenge in that we were in different places.

But luckily we had a couple of years as friends in college and we were in Bible study together. And so we knew each other really well before we made that kind of split. But yeah, the reason for moving up here was because I knew how many smart people there were up here and we needed those smart people to help us grow. So that's what prompted that decision.

So how did you two communicate being in separate cities? Because this is something I've struggled with before, because I remember when I put on a team where we were building mobile apps for education. We were all like covering the Bay Area, somewhere home in another state and somewhere in Southern California in it. It gets hard to consistently stay sort of on track with your North Star as a company.

Was there anything you guys particularly did to help enable that? Yeah, I think it's a lot of trust. And it's a lot of trust particularly in knowing that you each own certain things and you're not going to question what the other one is doing in that space. So for example, at the beginning, I owned user experience, even though he owned the actual product behind it.

So he knew that when it came to a question of, you know, how should the flow of this part of our product work, you got to call Josh and talk about that before you build it, don't just build it, whatever way seems right. So we had a very clear understanding of which parts he would do on his own and which parts I would do on my own. And conversely, I would never make promises on the engineering side without checking with him first to make sure it was something that was feasible. So there's a lot of just really knowing what needed to be communicated and what didn't, because both of those are important.

If you're not communicating enough, you're going to run into scenarios where the salespeople are promising things the engineers can't do and that causes a problem. But if you're communicating too much, then you're not able to focus on actually doing what you do. And it really just points to the fact that you don't have that trust in terms of, you know, I trust this other person to do what they do. They're really good at it.

And I do what I do. I'm really good at it. We don't need to constantly be going back and forth because that's just going to waste all of our time. So there's really two aspects of communication.

And one aspect of communication is actually the talking part. And the other one is knowing when you don't need to talk. Yeah. Yeah.

I love how you guys have very specifically defined roles. I think that helps so much and the overall trust between you two of, hey, Josh is going to handle this user interaction stuff. I think that's what he does. The other guy, no, that's not his territory.

So that you were sort of courteous to each other in that way. But even when let's say if you are a dresser, that person who needed the user experience stuff, you said, well, this is my area, I can address it. And then you just maybe report back to your business partner. Yeah, exactly.

And we still do this because we're still a fairly small team and everybody has things that they are personally responsible for. And they handle and other people don't jump into that. Or if there's a question about that particular area of the business, you know, to go talk to Jane and ask her how that's going or what the answer to a question is. So we'll have very, very own parts of the business that we actually are responsible for.

And it really helps because you're not stepping on each other's toes. And if you do have a question, you know exactly who to go to startups, listen to this operations wise, you need this information, even though Josh is, it sounds like it stumbled into a lot of it, but you need this information if you want to settle as much. Yeah, hopefully not as much as I have because it's been a lot of stumbling. It's like a real drunk person.

All right, I want to learn about sort of your initial user acquisition. I don't know what timeline wise was it just right after you graduated college that you started getting users like who were your first five, 10, 50, 100, et cetera, or some of those spaces of that. And how did you go about getting them? Yeah, so this is a really interesting part of our company.

So at first, when we were still in college, when we had first started the idea for the business, we wrote the first line of code in April of 2013. And that's when I first started pitching it on Upwork. And then I moved over from Upwork to starting to pitch the quiz idea directly to bloggers and other people that own small businesses, anybody that would listen, I offered to make them a quiz using our platform, put it onto their website and show them everything. And those got very little interest because there was not a lot of interest in the concept.

And the interest that it did get was rough, like 45 to 50 emails back and forth to make them a quiz for free, that they never paid for and actually never actually implemented on their website. So it was a terrible, terrible waste of time. And that was a direct email approach. So I got burnt out on that after 1000 or so email out, which is not getting a lot of responses and getting really bad conversations on the ones I did get responses from.

So at that point, it was maybe four months into us building a stuff. So late 2013, mid to late fall. And I started doing content marketing. And I didn't know a lot about content marketing other than I shortly ran a website where I did interviews with people and did blog posts about it.

So I knew a little bit about content marketing and how to drive traffic. And I thought maybe that would work for us. But I started out by writing a super generic post, like 100 blog post ideas that will energize your content. That's one of the ones that I wrote took me so long to write that.

And it's never driven a customer for us. And then I also wrote one that I was titled 20% of Google searches have never been made before, which is actually a true fact, which is crazy because there's 6 billion Google searches a month, but 20% of them are brand new every single month. So but those two articles in particular got us back links. So try and interact calm, started to get some back links.

I used to use Moz to track our domain authority and it started to get some domain authority. And I was like, all right, well, that's something. Yeah. You know, it's something to hold on to.

But it was not at all right traffic. We get thousands of people to click on those click-baity-ish articles and no one would sign up for our product. And then at one point, I read, I don't remember what it was, but I read some article about writing really educational content. So I figured, let's give that a try.

But this was a while on. So the first four months was even outreach. The next three ish were just these click-baity type articles. So I wrote 50 to 60 of them and did all those still nothing.

So we're about eight months in and it's getting close to April again and we graduated in June. So starting for a little bit. But I started writing these very tutorial type posts on how to use quizzes for X, Y, and Z in X, Y, and Z industries. And those were the ones that actually ended up driving customers.

So an article we'd write on how to use personality quizzes to generate leads for your food blog would get 10 hits total in a month. But one of them would come and sign up for our product and then upgrade so that they could connect the quiz to MailChimp. And this was starting in April of 2014. We started to get people that were reading these articles and they were coming and they were signing up and then they were upgrading to actually use the quiz to generate leads.

And it was crazy. So it was this piecewise method that was also again sort of by accident but also by working super hard. And let me get sound like not that much but I wrote 100 articles and I would spend three or four hours on each of them. And this was my senior year of college.

My senior year of college spring quarter had class five days a week. And I was also doing all this and we were also still doing agency work. So it was kind of bonkers time. But yeah, that's what ended up happening was those tutorial type posts ended up working.

But only because I had already done the click-baity type post that had us get domain authority so that the tutorial posts that were super specific would rank in Google. And that's what ended up getting us our first customers. That's an amazing story. And I tried in true lesson of content marketing that it doesn't always immediately work.

People jump into the game going, oh, I can do this myself. It's not going to take that long. Two to three months, I'll be great. It's usually a lot longer than that.

Yes, much longer than that. A very, very long time. It just takes time. It takes effort and consistency.

I think are the main pieces in doing content marketing. Not necessarily just like overall, I do content marketing. I put out a couple things and it should work. Lucky if that happens, but not always.

Yeah. And I think there's a lot strapped up in that. I love Malcolm Gladwell's book. I think it's Outliers where he talks about the 10,000-hour rule.

And if you work at something for 10,000 hours, you become an expert. And that's certainly true with content marketing. But the very important caveat to that rule, which is mentioned in a Freakonomics podcast that I listened to recently, is that it's not just that you do something for 10,000 hours. It's that you do something for 10,000 hours and you get practice feedback on what you're doing.

So I was getting feedback in the form of talking to people about what I was doing, feedback from other content marketers, feedback from other SaaS founders, feedback from articles I was reading, that kind of stuff. And that's what allowed me to kind of shift gears from the click-baity stuff over to the tutorial stuff, which ultimately unlocked the paying customers for us. So it was the sheer effort of doing this three or four hours a day, but also getting that practice feedback of having other people advise me on what I was doing. Yeah.

I think it's so interesting how oftentimes you might not see the writing on the wall until you dive deep into something like that. That you eventually realize that, hey, these articles might convert better. These might actually do better when I'm trying to gain more traffic to my site board. Yeah, which is a really hard thing because thinking back on it, and now I've come to embrace the struggle of it, but it's like you really have to be somewhere around your limit of effort and just thoroughness and grit before you unlock some of that stuff, and there's no shortcuts around it.

It's not like I would have come up with these solutions without putting in those thousands of hours, sitting there writing and getting feedback on the writing and that kind of stuff. There's no way around it. There's no shortcuts. And the same thing is through with the initiatives that we have now and the product improvements we have now and all the stuff we're doing now with hiring.

You still have to put in the effort. You have to put in the time. You have to make the mistakes before you'll unlock those little secrets that end up being what drives you through. And I think that doesn't get talked about a lot in startup world, especially where we just fantasize over the overnight successes and things like that.

But you talk to anybody that's really gone through it, and I'll tell you that the real secrets to success are somewhere far, far down the line of sheer effort and just practice. Yeah, seriously, everyone immediately jumps to the, oh, where are they at now? Not necessarily their historical information of how they got there. Yeah, exactly.

And we're not a giant company yet, but we are growing at the pace of hyper growth startup at this point, and we're doing extremely well and all these things. And we're already getting a ton of exposure, like way, way more exposure than we ever have before. And people are looking at us as if we're new. And I just chuckle every time because it's like, you don't even know.

You don't even know. It's been going for five years. Yes. You're pretty young.

So five years is a long period of time. It is. It's the fifth of my life. Yeah, exactly.

Exactly. So when these customers initially signed up, was it a SaaS model or was it like buying a tool? What was it structured as then? How's that evolved for you guys too?

Yeah, interestingly, it's always been a SaaS model. So from the beginning in our pricing, I was basically the same as it was at the very start. So it was a subscription to use the tools to make quizzes for lead generation. And that's what it was.

And that's what it continues to be, which is really interesting because it's been a very long journey. But the core values have not changed at all in that regard. Somewhere along the line, we thought we were going to do outbound sales and we raised the prices and that completely failed. And then we've switched back now to a content approach and the original pricing.

Yeah. So tell me about like, was there ever a moment in even when you're gaining your initial customers where you're like, mathematically, this might not work out. Like was there ever sort of a gloomy day for you? You know, there's a lot of gloomy days.

And that's why people don't talk about as much either. You know, there's the book, the hard thing about hard things. And basically in that book, talking about startups, it says there is absolute elation and crippling fear and nothing in between. And that's fairly true for a lot of the time.

Things have definitely evened out for me. But along the lines, it is a lot of absolute elation. Forbes signs up and starts using your product when you're sitting in a college library, which is a true story that actually happened. Red Lobster.

Tell me about that. Matt and I are sitting in YSRL. I remember the name of the library. It was the library in the back campus where you could kind of post up and camp out and no one would bother you, which is what we would do because we were working for hours.

And we were sitting in these rooms and just sit there and work on whatever we could accomplish in a couple hours. And towards the end of our senior year, we were starting to get customers. And one of the days, it was Forbes. I'm just sitting there.

I look up at Matt. I'm like, dude, Forbes just signed up and made a quiz and put it on their website. And we were like, oh my gosh, that is ridiculous. And there's, yeah, then a few months later, we were in an apartment still working on it.

I hadn't moved up to LA yet. And our server kept crashing. And we're like, what the heck is happening? And we look at Red Lobster at Launch the Quiz that was getting 80,000 people taking it simultaneously and crashing everything.

And it's like just the most absurd stories ever from those early days. So it's crazy stuff. I love those stories. Of all companies, Red Lobster too.

I know, right? And it's that quiz that happened in 2014 is their most liked Facebook post for their entire company's history. It's 192,000 likes. It is the funniest thing in the world.

And I talked to so many people that have taken that quiz and I'm like, well, now you know what we do. Yeah. This is a really cool thing that some startups actually are able to go through is, I had a previous guest. He's the founder of Wave, which basically now that allows you to create these little generate video out of audio files for social media because there's no way to really do that.

And you can post a minute of your podcast on it. And I asked him, have there been any interesting people who have signed up for your service? And it's kind of the same thing for you. You've had Red Lobster and he had somebody like James Altager signed up for his service or something like that.

Where's like, that's not a small name within that realm. So it's kind of cool to see that happen. When you're like, Oh, I'm just a college student. The lobster signs up for service or Forbes.

Yeah. And that stuff still blows me away back in the day was that would happen every couple months. Now it happens literally every day. And it's just absurd.

And some days it'll be two in a day and you'll just be like, that's, I don't even know anymore. Like, it's just, is this real? It's crazy. Who's been like the most wildest customer you've had?

They're using our platform now? I think the wildest one. Oh my gosh, there's so many. I think one of the wildest ones is the United Nations, which uses us all over the world for a bunch of different stuff.

But the United Nations refugee agency in particular uses us to raise awareness about refugees. So the do quiz is like, would you survive as a refugee, which is crazy? And the American Red Cross also uses us. So I've been in touch with their social media team.

That also happened that someone who were working in the library, but I've been working with them since then. So we've worked together for four years now. And they do quizzes like, you know, what kind of volunteer are you or are you prepared for a fire? Are you prepared for a flood?

And those are just really crazy. I had this one moment in particular. I was living in an apartment and there was an explosion next door, which was absolutely crazy on its own. But we walk outside and literally the first people there were the Red Cross and I had just been talking to them about their quizzes, strategy and stuff like that.

And it all became real to me in that moment where all of a sudden we were doing something real and meaningful because we were in some small way. We're not going to take a lot of credit, but in some small way helping the Red Cross as an organization. And then they were the first one there when there was that disaster that I was very close to myself. So that moment was very surreal for me.

I love that. And it's fascinating too. That you're not, you don't recognize your impact that you're actually going to have the whole, even when you're doing enthralled into your work. Yeah, exactly.

And there's so many ways that you can make an impact. We give a lot of free accounts to people like Oxfam, other organizations like that, Amnesty International, a lot of nonprofits, the SPCA. And it's cool to be able to have some sort of impact on that level. Well, I think there's something to say to an entrepreneur that, since they say of an entrepreneur who gets to a point and they're able to give back like that.

I think anybody who finds us any sort of success should be willing to do that. Yeah. And even along the way, you know, when we weren't doing so well, we do stuff like that. And it's, you know, you got to remember that at the end of the day, this not this really matters.

It's like, yeah, it's fun. It's enjoyable. You can get wrapped up into it, but you have to be able to constantly be in a place where you can disconnect and realize that this doesn't matter. And people are way more important.

And that's true amongst your team, amongst the people you're working with, customers, anything like that. And you always want to be in that headspace. Oh, for sure. So let's, we'll jump back to the timeline one more time here.

So you've moved up to the Bay Area. You've gained a handful of customers post-graduation, it sounds like, including Red Lobster and Forbes. I don't want to get them. And what, you go find an office in the Bay Area?

Does your business partner have an office in Los Angeles? Like, what is that? What is the structure of the business right now? Yeah.

So that's where it got kind of messy, if you will. So I was working at home. He was also working at home a lot of times, you know, we'd go back and forth and be working in the same apartment. So there were a lot of times where we were both working in the same apartment.

But growth was not fast enough to hire people, nor do we know anything about hiring people, or nor do we know anyone too hire. So we started thinking about who to hire, because that was the next step. Our product was struggling to keep up with a lot of things were crashing. People were making quizzes that would delete themselves, which was extremely frustrating.

Those were rough days. I would wake up at 2.30 in the morning to answer, support emails, because people were furious about stuff and they didn't want to wait. And then I'd go back to sleep, wake up at 10 or 5 and answer emails. And I would basically do that every couple hours to the night.

So I was like, having a new newborn baby, but none of that benefits. So it was, it was, it was, it was really tough kind of murky waters at that point. And we were growing customers from this content marketing strategy. And the first big challenge was we need to hire another engineer.

So we went out and got connected to one through a friend of a friend of a friend. And it turned out a funny story. He was in a band that both of us used to like when we were in Drew High and somehow the band had dissipated. And now he was an engineer.

So we were like, of course, we should hire that guy. That seems like a really good vetting criteria. That was actually our only vetting criteria. Like, sat down with him for coffee.

We're like, cool. And we hired him. We lasted two weeks. He got a better offer.

Jump ship. So that was an awesome first hiring experience. Oh, I'm sure. And even in like, I'm curious to know this, like structuring payment, like doing all that stuff for California taxes.

I mean, you have to go through all that stuff too as a startup. And I'm sure, I mean, did you get a vice on that? Like, yeah, luckily on that one, I did get advice on that from my brother who connected me to an engineer or an engineer lawyer. And the lawyer was like, I don't mess this up.

Here's how you need to do all this stuff. So we were fairly cashable, positive being just myself and Matt. And we weren't paying ourselves much. So we had somebody in the bank and we ended up dropping something along the lines of 15 grand to get everything set up properly through, you know, all of the different departments.

And then he also connected us to a bookkeeper and a CPA. So we did all the books right from the beginning. So we were set up to hire somebody. And we did that before we hired that initial person.

So luckily we did that right because there's a lot that can go wrong if you don't. But yeah, so we ended up getting really lucky on that through that connection. But yeah, so we hired that guy and that didn't work. And then, 15k to hire one person.