Transcript 0:00 [upbeat music] Welcome to the Newsletter Operator Podcast. I'm Matt McGarry. And I'm Ryan Carr. And in this podcast, we teach you exactly how to build, grow, and monetize your newsletter. 0:08 We'll talk to the best newsletter operators, creators, and media founders in the space, breaking down their strategies and growth tactics. Awesome. Let's get into it. 0:16 [upbeat music] Hey, Jay, welcome to the podcast. I am thrilled to be here, Matt, Ryan. Thank you for having me. Yeah, thanks for joining. 0:33 You're someone who I kind of struggle to describe in one or two sentences. Like, you have an awesome newsletter, you have a private community, a podcast that I really enjoy. 0:42 You help creators become better creators and grow and monetize their audiences. But what do you call yourself? How do you help people? Give us an introduction kind of. I call myself a creator. 0:51 It's, it's awkward to say I'm the creator of Creator Science. Like, the double word creator is kind of annoying, so when pressed, I'll say, "I'm the founder of Creator Science." And if you say, "What is that?" 1:01 I say, "A media company supporting professional creators." And I'm cross-platform. 1:06 I'm on a lot of platforms because the creators that I serve are on a lot of platforms, and so I want to be as much a practitioner as I am an educator, which puts me in the very challenging position of doing all of the things and trying to do them well and credibly. 1:22 But let's just say Jay's the founder of Creator Science. Yeah. I, I like that. Give us an idea of, like, the different platforms you're on and how to use them. So you have a newsletter, podcast, et cetera. 1:31 Tell us, like... We'll start with your newsletter, for example, 'cause we talk a lot [chuckles] on newsletters, as you know. So what's your newsletter called? What, what is it about? How many subscribers do you have? 1:39 And maybe if you can share, like, engagement data too, like open and click-through rate. We always love to hear about that. Well, you're not gonna believe this, but the newsletter is called Creator Science. 1:46 The podcast also called Creator Science. The newsletter is about forty-one thousand subscribers at this point. I can pull up ConvertKit here. Forty-one thousand subscribers. Open rate is forty percent. 1:56 Click-through rate's about two and a half. Click-through rate is always something I've had, like, kind of an antagonistic relationship with. That's where the newsletter sits right now. 2:05 The podcast does between thirty-five and fifty thousand downloads per month. The YouTube channel literally just crossed twenty thousand subscribers moments before I joined this call. Awesome. 2:16 And we're getting close to a million views there all time. So it's, it's all over the place, and it's, it's all growing pretty well. And then break down your business model for us. 2:26 So you have a couple different ways you, you make money. Tell us what those are. We can, we can dig into those. I have what I count as six different revenue streams. The biggest one is my membership community, The Lab. 2:38 That accounts for about seventy percent of my revenue. Followed by my sponsorship part of the business, which I believe is, like, f- fifteen? I forget what percentage that is. 2:51 But it's memberships, sponsorship, affiliates, digital products, services, and royalties. That's interesting. 3:00 So I, I wanna break down all of those, but maybe a good place to start would be a question from our audience, because we have a lot of people in both of our audiences who are aspiring creators, aspiring founders. 3:12 You have a lot of advice for them. I think your stuff is really insightful. It's helped me a ton. And so from Twitter: "What is the wisest path to become a full-time creator?" 3:19 I think that's a good parallel because, like, there's lots of ways to, to make money right away, but maybe that's not the best path in the long term. So I'm, I'm curious to get your take there. Yeah. 3:27 I, I put out a tweet about this recently, so I'm going to kinda key off of that because this is a little bit generalized in terms of, like, platform. I don't wanna be prescriptive in terms of platform. 3:37 We can, we can go into my opinions on, like, where there is the most underpriced attention right now. 3:43 But I would say if you're trying to start from zero, the most important thing is to choose a subject you're curious about. This gets even more powerful if it's a subject that you already have some experience in. 3:53 If you already have experience in some realm and you wanna continue to double down on that, choose that for sure. 3:57 If you don't have experience in some realm that you wanna double down on or you have experience but you wanna go somewhere new, choose a subject that you're curious or really interested in. 4:05 Spend a ton of time researching it, consuming everything in and around it. Not even just stuff that's happening today, but, like, past materials that are related to it. 4:15 Then I would publish summaries of the things that you've learned from that effort of consumption. Like, tell people, "Okay, I've been, like, consuming a ton of information about this subject. 4:25 Here's my summary of the most important, interesting bits of it." That can become... Probably a newsletter is a good place to be for that, but again, I'm gonna be fairly platform agnostic right now. 4:36 If you're consuming all of this and you're starting to write summaries of what you're learning, at some point you will start to have a little bit of a voice in your head that starts to make connections between different things that you're learning, and y- you really need to tune into that. 4:49 I think a lot of people tune it out for too long. 4:52 They have, like, imposter syndrome, and they don't trust themselves to make their own connections and assertions and opinions, but you are absorbing so much information that you're in a great position to start connecting dots, and you should trust yourself to do that. 5:07 When you connect those dots and form these original opinions, then you should start to publish those opinions. 5:11 Instead of just publishing summaries and curations and aggregations of what you're learning, now you are getting more editorial and you're sharing your insight, your opinions. 5:21 And if you're s- if you're doing that consistently, then the game is just getting better and better at the craft of whatever medium or platform that you're on. And then do that for, like, three years and you're good. 5:32 If you were getting started today and you wanted to grow the fastest, what, what kind of platform would you look for? It, it depends on your interest in video, because there are kinda two paths. 5:44 There's the video first path, and then there's the writing first path. It's rare that somebody is great or interested in being great at both and can do both concurrently, so you kinda have to pick one or the other. 5:56 If you're going the video route, then I would be focusing on Instagram Reels and YouTube Shorts right now. I think TikTok is also still performing really, really well, but I think it's a different-... 6:07 audience and a different game, and personally, I think it would be more difficult to monetize and build a business off of a TikTok audience. If you are drawn to writing, then I would be going LinkedIn right now. 6:20 I think LinkedIn is trouncing Twitter. I think Twitter is dying a slow death, unfortunately. 6:23 Hopefully, it pulls out of this nosedive, but if you don't already have an engaged audience on Twitter, it's a tough place to be right now, I think. And those are discovery platforms. 6:33 So I think it's always gonna be easier to get attention on what I classify as discovery platforms, where there is an innate mechanism for connecting new viewers to your work. 6:45 Newsletters are an interesting spot in this moment where there's actually some organic discoverability in newsletters now too. 6:52 So it's creeping into, like, this in-between place where, yeah, newsletters have more discoverability and growth potential organically than they ever have, and so that's, that's interesting. 7:03 I think email should be part of every single creator's strategy, and I say email, not a newsletter, because I see a little bit of difference between those two classifications, and I think email is a core part of everyone's strategy, whether you want to write a newsletter or not. 7:20 Really quickly break down the difference between a discovery platform and a relationship platform. I think that's, those are the terms that you use. Ex-explain that for us. Yeah. 7:28 Discovery platforms have this built-in mechanism for organic discovery of your content, typically as an algorithm. 7:34 It's some platform that is probably monetized through ads, and so that platform is incentivized to connect great content to people who are consuming content because that keeps people on the platform. 7:44 That's more time on platform to sell ads to, right? So social media, YouTube, Google, these are monetized by ads. You are the product, but as a gift, they bring attention to your content in that way. 7:59 That's a discovery platform. There's a third party that's incentivized to connect people to your content. A relationship platform is decentralized. 8:06 There is not a third party that is incentivized to drive people towards your content. This is email, podcasting, SMS, and I would even, I would even put private communities in this bucket. 8:17 However, the upside of this is there's also no third party that can change the rules. You are building distribution that you own in email, podcasting, SMS, or private communities, and that's really, really valuable. 8:29 So the game, in my opinion, is leveraging discovery platforms to bring in new attention to you and your work and then kind of siphoning that off into a relationship platform where you build a means of distribution that you own for the long term. 8:43 Let's talk about relationship platforms 'cause I think this is something you talk a lot about, I almost exclusively [chuckles] talk about, and you bring up, like, the four different types, which I think a lot of people don't even realize that. 8:51 They think about email or newsletters as the only one. We have a lot of audience who has a Twitter following or a LinkedIn or whatever, but they don't have any relationship platforms. Where should they start there? 9:01 Like, what do you think-- how do you think about the pros and cons of all those four different, uh, relationship platforms, and what should people use first? I th- I think email's the move. 9:09 I think you can make a compelling case for SMS if you really wanna do it and you typically communicate in sh- short, frequent bursts. 9:19 You know, SMS is almost as if you have a decentralized private Twitter feed, or could be, you know? 9:27 But I think email should be part of every creator's stack because that is still where you have probably the, the easiest path from awareness to purchase behavior. 9:39 It's, it's just what the back of so many creator businesses are built on. And, you know, it's, it's a great alignment of incentives. 9:47 The people who receive your email are consenting to receive it, and it will reliably show up in their inbox and maybe their primary tab for as long as they would like it to. 9:56 There isn't a feed that is choosing the most relevant emails for you. It's still chronological. 10:02 There is the tab thing in Gmail, so there is a little bit of that, but at least emails are showing up chronologically in the inbox. 10:10 And if I want to hear from you and I decide at some point I want to hear from Matt, and I drag that over to my primary tab, it's gonna keep going there until I stop opening it or stop wanting it. 10:21 And then since we're on that topic, emails versus newsletters. How do you think about that? A lot of people don't wanna write a weekly newsletter. That's a lot of commitment, right? 10:28 How should they think about the alternatives to that, especially if they're doing this part-time? It's a square rectangle situation. All newsletters are email. Not all email is a newsletter. 10:38 And I think that there are lots of things that I would want to communicate via email that don't fall in the bucket of being classified as a newsletter. Today, I had two open spots... 10:49 No, sorry, three open spots in the lab, and I wanted to let members who are on the basic membership, the entry tier to the community, I wanted to let them know that, hey, there are three spots available for people who want to upgrade. 11:02 It's not a newsletter. I didn't wanna send a newsletter. I just wanted to send communication to this small number of people via email, you know? 11:10 And so that's a really important style of communication for me, is communicating with different segments of my audience about different things and not having it be, like, a digital version of a postcard or a newsletter or something. 11:25 It's, it, it's... Or a, a newspaper or something. It's, it's much more like I just have something to tell you, and this is my most direct, consistent way of communicating with you. 11:35 Right now, I'm rebuilding my personal website because I wanna have a personal blog, and I started building it on Ghost. And I thought to myself, "This is the time when I'm just gonna go all in on Ghost, actually. 11:48 I'm just gonna use Ghost's emailing functionality. Everything I write we'll just send directly via Ghost." But as I'm getting it built, I'm realizing, gosh, but when people sign up, I wanna send them a welcome email. 12:00 I wanna, I wanna have a great experience post-sign-up that is controlled, and a lot of newsletter platforms don't really allow for that. I need an email marketing platform. 12:10 So that's the way I think about the differences.Yeah, you don't wanna lock yourself into where you can only send someone a newsletter once a week or once a day, and you can't send them anything outside of that, and if it doesn't have this design and template, like they're not gonna receive it. 12:22 There might be a little bit of a false dichotomy that some, some people's mindsets where like they feel like they have a weekly newsletter and they're afraid to send outside of that. 12:29 I think people need to kind of break through that and say, "It's okay to send the occasional marketing email- Yeah... or update or, or stuff outside of that. It's not really gonna affect you in a negative way. 12:36 I think the term newsletter is something that is perpetuated by platforms. This is, this is a hot take. I'm thinking this for the first time and articulating it in real time. 12:45 But I think the term newsletter is perpetuated by email marketing platforms who want a foothold. 12:51 And so this is a known modality of sending and receiving email, and so they say, "We're a newsletter platform," because that's what get customer- gets customers in the door. 13:00 But just about every creator I've ever met who has started sending a newsletter has felt limited if they do not have email marketing capabilities within that tool. 13:09 And so really anything you want to send emails through, you want email marketing capabilities. And I think any newsletter platform will add to its stack a feature set of just pure email marketing. 13:23 It's just not how it's marketed, and so a lot of people who are becoming aware of newsletters and opting into them for the first time or starting to use them for the first time, they have an incomplete view of what the function of email looks like for a creator. 13:34 Yeah. 13:35 I mean, we found similar things at The Hustle, and I mean, across all the newsletters that we work with, kind of one-off marketing sends tend to convert significantly better to, to, you know, your kind of paid products or your revenue generators than just plugging in the newsletter. 13:49 So yeah, I mean, totally, experience totally aligns there. You mentioned the Lab. Could you... And, you know, your community. 13:55 Like could you explain a little bit more about, about the Lab and how you've built it and kind of what the feature set is there? Yeah. 14:01 The Lab is my private membership community for professional creators, people who are doing this or working towards doing this as a full-time means of income and, and their lifestyle. 14:14 So the, the point of the Lab at this point is for these people who are well beyond the basics, who are operating practitioners, running real businesses, the landscape of being a creator changes constantly, and you don't wanna wait for some new piece of thought ware from someone else to react or innovate. 14:36 Professional creators are innovating all the time. They're experimenting. They're trying things out. They're learning from it, and they're operating based off of it. 14:41 So I wanted to create a space where people could ask questions of other people who are in that same trench and a place for people to share the experiments and the results of those experiments that they're running in real time. 14:52 Like I said, it's become the most significant part of my, of my revenue. I've made a bunch of different design choices in the Lab. Like, we have a 200-member cap for the community spaces there. 15:04 So it's, it's been like the financial engine that's allowed me to experiment and try a lot of things in my business, invest in growth. 15:12 The, the YouTube channel that I mentioned, that's a new effort over the last 16, 18 months, and that has been funded primarily by revenue that's coming from the membership. 15:22 So I think that similar as I think every creator should use email, I think every creator should have some means of revenue that is a direct relationship and transaction between them and their audience, because that's a little bit more resilient. 15:37 You know, I see a lot of creators get into this, and they think the strategy of monetization, really the only way towards monetization is through sponsorship, ad revenue, brand deals. That's a great source of revenue. 15:48 That's really, really great, but it's also less in your control. And a lot of times when that goes away, it's not even anything to do with you. It's like macroeconomic type things. 15:57 And typically, if you have a direct relationship with your audience and something that they can purchase directly from you without a third party being involved, that helps you build a more resilient business. 16:07 For a sense of scale, so 200 members, this is a high price thing. I think the starting price is at $2,000. 16:12 So, like, give us a sense of, like, what type of revenue is this generating, just so the audience has an idea of how successful these things can be. 16:18 It's annual only, so, you know, the best figure I can give you is ARR, the annual recurring revenue, which is about $324,000. 16:28 It's, it's the equivalent of about 27,000 monthly recurring, but it, it recurs annually, you know. 16:34 I didn't do big launches of it, so it's actually a pretty even distribution of what months members joined in the previous year, which was intentional. 16:44 So this year it, it almost feels like MRR on a monthly basis because I get a lot of renewals, but it's, it's a larger price point on each of those, those renewals. 16:56 And I thought that was important because, one, it was really important to me that I designed the membership so that it was sustainable from the beginning, and I was incentivized to invest a lot of time in it. 17:05 Because the experience is a lot of access to me and a lot of my time and attention in there. And two, a lot of the value is derived from the, the questions, the ideas, the experiments, the conversations between members. 17:19 And so in a community like that, I think it's really, really important to limit the volatility in the literal membership. 17:25 You, you don't want people coming in and going out, because the relationship is the value that I find in this space, and so I'm not gonna invest a lot of time or effort into relationships that feel very, very temporary because people are coming in every month or two or three. 17:39 Instead, I wanted everybody to give it a full year of effort upfront, and so that's a commitment on the point of the member. I recognize that. 17:48 Um, and that's also, like, the type of person that I wanted to filter for, to be honest. 17:52 You know, I think every desi- design decision you make in how you build a product, whether it's a membership or not, is, uh, a decision that filters for the eventual customer. 18:03 Like, design decisions are customer decisions, and I wanted a committed professional person. So we talked about creators monetizing things outside of ads and sponsorships.You started with a community. 18:18 I want to talk about different revenue models outside of just community, but let's start with that one since we're on this. How do you start a paid community from scratch? Because there's kind of a cold start problem. 18:26 If you, like, are trying to sell a community but no one's in it, you can't really sell it because that's the value. Or maybe you can. So how do, how do you think about starting one from, from the beginning? 18:33 That's theoretically true, but I think the bar is much lower than most people think. And let me also just preface this by saying, I do not paint a rosy picture of community building or membership building. 18:43 It's a hard thing to do. But I, I want to follow that up by saying, I think a lot of people think it's going to be harder to get started than it actually is. In my opinion, you need five people. 18:55 Ten people would be great, but in my opinion, you need five people. That's not a big, that's not a big number, you know? 19:01 Now, it's important whatever number you get between five and ten, you want them to all show up at basically the same time. Because then you have a core group that starts to coalesce. You can start to run live sessions. 19:15 The smaller your membership, the more I think you should lean on live sessions to very hand to hand create connections between people, and that'll start to spawn conversations in the forum, direct messages. 19:28 The, the more I know and relate and like the people in here, the more I'm going to be willing to put myself out there asynchronously in a forum. So it's, it's important to introduce people to each other early on. 19:41 I have a, I have a two-phase approach to launching a membership, and this is in a course I made called Build a Beloved Membership. But the two-phase approach that I share is a private opening and then a public launch. 19:54 So during the private opening phase, that is saying, "Okay, I'm gonna start this community. 19:58 It's gonna be priced at X, but I want to give my biggest fans, my closest supporters first opportunity to join this, and I want them to help build the cultural frap- cultural fabric of the community." 20:09 So when I launched the lab, I priced the membership originally at nine ninety-nine, a thousand dollars per year. And I went to my email list, my social media, and I said, "Hey, I'm starting a membership. 20:20 It's for professional creators. I don't have a sales page. I don't have anything to show you, but if you trust me, sight unseen, you can join for fifty percent off your membership for the life of that membership." 20:29 And I didn't have to create anything other than the digital space on the back end. And I had somewhere between twelve and twenty people that joined at that point, which is a really, really great start. 20:39 You have a small group. You can build connections. You can also document what the community experience is like. 20:44 So instead of creating a sales page that is all theoretical, like, "We will have this, we will have this, we will do that," the moment you go out with a sales page, you are actually sharing real quotes from members. 20:57 You're sharing photos from the live sessions you're doing. You're showing screenshots of the community and some of the activity in there. You're documenting a party that's already in progress. 21:05 The cold start problem is I'm inviting people to a party, but no one's at the party yet. 21:09 And so this private opening, public launch is a good way to get some people at the party, so when you go out to the rest of the world, people who are 21:17 going to be more on the fence by default, it's a more compelling pitch. I love that. One question about the live sessions. How do you think about those? Like, are they masterminds? Is it, do you have a speaker come in? 21:28 Any examples you can pull that would be hel- be helpful for people who wanna do some live community sessions? 21:33 There are a lot of different types of live sessions you can do, and I think you have to ask yourself, what is the role of programming? I call live sessions programming. What is the role of programming in my membership? 21:43 Is it knowledge transfer? Is it connection between members? Is it access to people that they typically wouldn't have access to? You need to ask yourself, "Why do I wanna have programming? What's the point of it?" 21:55 And then there are different types of sessions you can do within that. If it's knowledge transfer, you know, you might wanna do, like, an office hour session or you might wanna do a master class. 22:04 If it's connection between members, you might wanna do some sort of social or, you know, some sort of almost community speed dating. 22:11 If it's access to people they can't normally have, it might be, like, a fireside chat or a presentation or a workshop from someone else. So it really starts from what is the experience you're promising in this community? 22:24 What are people gonna get when they join it? And then how do I support that promise with programming, designing programming that fit the purpose, if that makes sense. Yeah. 22:33 And that's, that's super tactical knowledge for anybody that's trying to build a community that's listening right now. 22:38 I know that communities are a popular suggestion for folks that are trying to monetize their newsletter audience versus an audience in general. 22:46 I, I was looking through, I saw you have a kind of a lead magnet type thing called, uh, the Revenue Swipe File. Yeah. 22:53 And I thought it was super, super, again, just like tactically interesting, uh, 'cause I, I mean, the point that you made about sponsorships and ads and ad space being a great kind of supplemental source of revenue, but not necessar- it shouldn't necessarily be the end all be all if you're building an audience and trying to monetize that. 23:12 But there are a lot of really interesting examples in there. 23:14 I'm curious, and not to put you on the spot, but are there any that you've come across just in your writings about creators, you know, ways of monetizing or examples of folks monetizing their audience in an interesting way that stand out as unique? 23:28 There are two things that I've been thinking a lot about. I could maybe say three, but at least, at least two. One of them, there's a woman named Sarah Renae Clark. 23:36 She has a YouTube channel that teaches adults how to color. It's like coloring for adults. I used to say, like, adult coloring books, and then people got the wrong idea. It's coloring for adults. 23:48 And she started by creating coloring books. Very smart. Makes a lot of sense. Very cool product. But then she went a step further and said, "What else is helpful and interesting to my audience?" 24:00 She created a physical product that is a cube. It's almost like a Rubik's Cube, but probably like three X the size. 24:06 And you can open it up, and there's a pack of cards inside of that that all have different color palettes on it. On one side is the color palette. It has, like, five colors. It has the hex code. 24:15 On the flip side, it's a photoFrom nature. It's like a photo of nature, and that color palette is derived from the photo. 24:21 So she knew that a lot of her audience really enjoyed like color theory, matching colors togethe-together, making things out of colors. 24:29 And so she gave them a reference for different color palettes that are ready-made that go well together. And I think she's, she's sold over a million dollars' worth of, of these color cubes. 24:40 And so I use that example because I think that people don't think expansively enough about what is possible in their revenue model. They think, "Well, if I'm gonna do physical products, like I'm gonna do merch. 24:51 I'm gonna do like this, the sweater or the hat that Jay's wearing right now." And you could, you could, but like there's so many more opportunities out there. There, there are calendars. There are word a day type things. 25:03 Like some, some really expansive ways to get out there. You don't have to think about what already exists and can I do my version of that? Like this color cube thing, there was no corollary. 25:13 There was no, there was no thing to compare it to. So that's idea number one. 25:17 Idea number two, I've been listening to a great podcast called Founders by David Senra, and he has this founders AMA feed, which I think is really interesting as a product for his business specifically. 25:28 You know, his, his business is a podcast. The people who listen to Founders can't get enough. His product is more podcasts essentially, but it's, it's an AMA. 25:40 You know, usually his, his podcast is him sharing what he's reading in a book, some of his opinions, but not, not really. You don't get a whole lot of David and his personality, his opinions based on the book. 25:51 You mostly get David's take on the book, David's summary of the book. It's the founders AMA fee- feed gives people this like quench to their thirst of, "Well, I listen to so much from David. I like David. 26:01 I wanna learn more from him. Now I can directly ask him questions." The third one is kind of related to that. 26:10 I think that basically you'd call it a membership, but I think paid subscriptions to additional content generally is interesting. You know, your, your audience is more newsletter based. 26:21 I think having a paid newsletter is an interesting thing right now that when done well, is one of the best business models out there. 26:31 There's a risk, I think, of doing it too early and making it basically divide your focus, double your work for what I wouldn't say is a worthwhile return. 26:42 But if you're at a point of, you have a fair amount of readers who really like your work, and you do the math and say, "Well, if I charged ten dollars a month to people who really like this, and I gave them an extra, you know, thing a week, 26:56 is that enough on a weekly or monthly basis to incentivize me to do extra work?" When the answer to that is yes, I think it's a really compelling business model. 27:04 Do you ever have any like training wheels products that you recommend? 27:07 There's a lot of people listening who have an audience of five thousand, ten thousand, a hundred thousand people, but they're not monetizing outside of sponsorships. 27:14 You know, are there like templates like you should pay community, a cohort-based course, on-demand low-ticket course, all those different kind of templates you think? 27:22 I would not say a community or a membership, because those are perpetual products that are hard to back away from. 27:27 So anything that you wanna like test the waters, I would pick some sort of product or experience that is time-bound, that has a beginning and an end, so that you can basically reassess and say, "Do I like that? 27:37 Do I wanna keep doing that?" When you start introducing monthly or annual subscriptions, you create this kind of sticky thing that's hard to undo ethically, depending on your ethics, of course. 27:48 So I would say from a product development standpoint, I think one of the more compelling things you can do is start by offering a cohort-based course, because the market still values that very highly from a pricing perspective, much higher than a self-paced course or a lot of other things. 28:05 So you don't need a ton of transactions for it to be meaningful revenue and, and be sustainable in and of itself. So if you do a cohort-based course, you do that, it lets you test curriculum in real time. 28:15 You can see how it lands, you can see gaps in how you're explaining things, where people get lost. It's very informative as to your ability to teach something. 28:26 And so you do that, you realize you suck at doing it, you do it a second time, you get better. By the third time, you're probably pretty good at it. 28:33 Then you can take that and say, "I'm gonna make a self-paced version of this. I'm going to now take the time and effort to produce the self-paced version of the best, most efficient knowledge transfer of this thing." 28:43 Maybe you keep doing the cohort because you can charge more for it. Maybe you don't. 28:47 A lot of people are moving towards this, this kind of high-ticket hybrid model, where they say, "I'm going to produce the knowledge transfer in the most efficient manner possible in self-paced videos," because people can actually then watch that at one and a half, two x speed. 29:03 You can't speed up real-time Zoom calls, you know? So in some ways, cohort-based courses I think are really an inefficient way to learn. 29:11 But if you, if you're good at teaching this, you can make the knowledge transfer part of it as efficient as possible, give people access to that, and then marry that with programming, live sessions inside of a community space. 29:22 You can say, "Hey, you are buying this outcome. The way you achieve it is by working through our tested, proven curriculum. And while you're doing that, you have a supportive community by your side. 29:34 You have access to that community for the next twelve months." I think that's a really compelling approach and, and roadmap. What, what are some good examples you've seen of both of those? 29:44 So either cohort-based or hybrid, any that come to mind that do it really well? The granddads of cohort-based courses are Tiago Forte with Building a Second Brain and David Perell with Rite of Passage. 29:54 Ali Abdaal did it really well with Part-Time YouTuber Academy as well. All of them, I think, maybe not David. 30:02 Tiago and Ali have definitely moved towards the high-ticket hybrid route because it's hard to do a cohort over and over again. Like there's no done with it. You have to launch it, you have to do it. It's a lot of work. 30:13 And when you have scale the way these guys do, they've had the experience of, "I make a thing, I put it out for sale, and then-It generates a ton of revenue. I don't have any fulfillment on the back end. 30:22 That's a hard thing to ba- walk away from and say, "I would actually prefer to spend time in fulfillment." 30:29 Uh, but I think high-ticket hy-hybrids are still challenging to do well because community is challenging to do well. 30:35 So I think we'll see a lot of people who do cohort-based courses move to high-ticket hybrids, do that poorly, realize they're not having good student outcomes, not getting good word of mouth, go back to doing cohorts. 30:47 People who do the high-ticket hybrid well, Marie Poulin of Notion Mastery. Mariah Coz is, like, the person who coined that term and has helped a lot of people put it in place. 30:57 I haven't experienced Mariah Coz's programs, but I would bet she does it really well. Back in 2017, I went through a program called Growth University by Brian Harris. 31:05 He was super ahead of the curve, and I think what he does is really compelling as well. Yeah. Those are great examples that everyone should check out. So we've talked about kind of methods of monetization. 31:17 I'm interested to know in practice how... what your funnel looks like from the newsletter, from kind of these relationship platforms that we talked about to the actual sale or the purchase. 31:28 I know you mentioned the community is capped at that, at that two hundred person, so maybe that's not being a-advertised as much. 31:35 But for other revenue streams that you have, how do you think about u-utilizing the newsletter to drive purchases there? It's pretty broken, to be honest. This is the most broken part of my business. 31:46 It frustrates me every day, and it's my biggest priority to fix because my best product has a cap on how many people it can accept that I put in place, and I could say, "Guys, changed my mind. 31:59 Not gonna have a cap," but I don't really wanna do that. So what I don't really have is a customer journey that monetizes well from the point of subscription. 32:09 I have started using a tool called RightMessage by Brennan Dunn. It's an incredible tool, and I'm now generating somewhere in the ballpark of three 32:19 sales of products per day simply from, like, a questionnaire widget that lives on my website. I saw that on your site, and I thought it was so cool. It was the first time I had seen it too. It's awesome. 32:30 It's performing so well, and it's-- it has the potential to be transformative for the business, but it doesn't have much of a journey. 32:37 Essentially, when you go to creatorscience.com, it asks you some questions, and it makes a personalized offer to you of the products that I have. 32:44 But every journey kind of ends at that product, and there's not a great next step. 32:50 So I had recently been experimenting with some paid email acquisition, and we got some people getting to that point and purchasing that product, but there was nowhere really to go after that. 33:00 So the economics just don't quite work for me yet to do that, which just suggests a larger problem, which is a hole at that part in the... at that point in the customer journey. 33:08 So what I need to do is create a more broadly applicable offer that applies to creators regardless of platform or medium they operate within, and I think that would have, like, a huge impact on the business. 33:21 And it's, it's gotten to the point where I've built it up so much in my mind that I h- I can't decide what I want that offer to be. 33:27 I have a few competing ideas, and the result [chuckles] is that I'm not building any of them, and I just continue to have wasted opportunity. [laughs] Well, I'm sure it's gonna be successful when you do launch it. 33:39 You have such a wealth of, of content available. Um, yeah, like I said, I highly recommend that anybody listening check out the revenue swipe file. It's just, like, packed with great ideas. Yeah. 33:50 We're adding to it all the time at creatorscience.com/revenue. Thank you for the layup. We'll link it below. What are some creators that you admire, look up to, model from? Could be any niche or anything. 34:01 Who have you learned from? I spend most of my time, if I'm consuming content, learning from artists of different types. So, like, the podcasts I listen to are about music. They're about comedy. They're about writing. 34:16 Lately, I've really been enjoying David Perell's How I Write podcast. I think he's putting a ton of effort into the production of it. 34:25 Like, I just really, really respect effort and craft at this point in my, in my development, so I'm looking more at people who are creating excellent content than I am people who are successful f-for being successful. 34:43 In my space, there are a lot of people who are successful for being successful. It's kind of a, it's kind of a Kardashian thing, and it's no knock on them. 34:50 Like, I think that there is a Venn diagram, and one circle is people who have done legitimate things. The other circle is people who have... 35:01 people who are known for doing le- or for kn- known for being legitimate, and then there's this middle ground of people who have done legitimate things and are known for being legitimate. 35:10 Everyone wants to be in the middle. They want to be genuinely legitimate [laughs] and be known for it, and there are a lot of people who start out, 35:18 and they can generate this belief that they are legitimate, and that perpetuates and pushes them to the middle of this ground because now that it's become a self-fulfilling prophecy. Anyway, 35:29 my BS meter is at an all-time high, and I just look for craft. I look for crafts more than anything else. What do you think about the creator conglomerate, creators who want to own a zillion different businesses? 35:43 And I think, like, Nick Huber is kind of... There's people who've done it before him. He's kind of pioneered it, so has Alex Hormozi. Yeah, I think what Nick Huber, Sahil Bloom, Kevin from Epic Gardening, 35:54 what they're doing is they're vertically integrating, which I think is brilliant. Like, vertical integration in business is a smart thing. 35:59 I think that a lot of the means of vertical integration right now are agencies or service-based businesses, which you know, hard business to run over the long term. 36:10 And I th- I think a lot of that will probably be a learning experience. 36:15 So I think that vertical integration in a business, I think Kevin at Epic Gardening is doing it better than anyone else, and I think there's a huge opportunity for creators to do this. 36:24 It's just a little bit capital intensiveBecause you need to hire good people. 36:30 You need to hire people who have the capability to do different things or the capacity to build the capability, and I think that's resource intensive. But I think we'll see more of it. I think it's something that you 36:46 earn the ability to experiment with and try that comes from, you know, having resources to try. But I think it's brilliant, and I, I think we'll see more and more people do it. Can you explain vertical integration? 36:58 And maybe you can talk about Ep-Epi-Epic Garden as an example. I don't know a ton about that. Yeah. But I think there is a key difference between owning ten different businesses that have no synergy and integration. 37:06 So how does that work? Okay. Yes. Okay. You asked conglomerate, and I thought you were speaking to people who are doing vertical integration. These are different. 37:15 People kind of think about it as one thing, but there is a difference, so I'm glad you pointed that out. Yeah, big difference. 37:19 Like a conglomerate is, is kind of like building a holding company where you're saying like, "I own multiple businesses. They cash flow. 37:27 That feeds up to a, a higher level company, and I do interesting things with that cash flow, which might be buying more businesses." That's like a, a time-tested... People have been doing this for a long time. 37:38 Like the way you build wealth is by... Well, one way you build wealth is by creating valuable assets, and you can buy valuable assets. You can build valuable assets, and we're seeing creators who are doing both. 37:52 They're building like this portfolio of businesses. 37:55 Then there's vertical integration where you say, "Everything that is in the operational or supply chain of my business is something that I can outsource or do in-house." 38:09 And in the beginning, you do a lot of outsourcing because it's cheaper. Sometimes it's done in the way of revenue share. 38:18 For example, historically I've worked with agencies who help me monetize my newsletter, who help me monetize my podcast, my YouTube channel. They keep a percentage of that, whatever they earn. 38:30 I could instead build the capability in-house to manage all of my ads and sponsorship revenue, and I wouldn't be giving a percentage to somebody else. 38:39 You do that well, and you probably reap a greater benefit than the cost to do it, but you have to have the means, the resources to pay for the cost to do it. 38:49 Sahil, Sahil Bloom, looked at his business and said, "I'm paying for agencies to do design, animation, email growth. I'm gonna turn all of my cost centers into profit centers. 39:01 I'm gonna look at the things I'm outsourcing, and instead I'm going to find an operator, hire them, build an agency around that capability." 39:07 So they're still doing my work, but I'm also selling a large percentage of their time to other people. It's generating more cash flow than I'm putting in. 39:16 That feeds up to the owners of the business, and now there's more cash flow that I can use to reinvest in the business, start another business, buy another business, that type of thing. So that's vertical integration. 39:29 Kevin at Epic Gardening started as a blog, became a YouTube channel. The YouTube channel was doing well, so he started doing affiliates. Then he realized, "Why w- don't I just sell my own products?" 39:41 So he started developing his own products. He started buying businesses that supplied his products. 39:48 And so now, you know, instead of buying a third-party product via an affiliate link in a YouTube video, you are buying an Epic Gardening branded product, probably converts higher because you have higher trust in that brand anyway. 40:02 That's why you're watching that channel and taking their recommendations. But they don't just take a commission, they get the lion's share of the profit. 40:09 Kind of feeds into [chuckles] the, the conversation earlier about moving from sponsored placements to, to own products, right? 40:16 Like it seems like it's kind of just a theme, just the more you own, the better off you are in the long term with monetizing your audience. Yep. It just... 40:23 It's, it's more difficult, it's more resource intensive, and it requires an entrepreneurial faculty. You know? Like you need to be willing or able or, you know, already good at doing entrepreneurial things. 40:38 Like Kevin's written the story on Twitter before about how the first product he was going to sell directly were these large, what are they called? 40:48 They're plant beds that are out of the ground, raised beds, large aluminum raised beds. He had to buy a shipping container worth of these things, so he had to learn, "Who do I buy this from wholesale? 41:00 How do I get a shipping container into the United States? Where do I store this inventory? How do I manage fulfillment for people who buy from me to get it from that warehouse?" 41:10 You know, these are entirely new functions that the organization, the enterprise has to learn how to deal with, and most people say, "I don't wanna do that. 41:20 I can just be an affiliate for the, the raised bed company, and I'll take my cut." 41:25 And that's gonna be easier and cheaper in the beginning, but, you know, as Epic Gardening has grown, they sell a whole ton of [chuckles] these products. 41:36 Now they're getting a much bigger return on a per unit basis, which just adds up very, very quickly. Do you see any traps that creators can fall into i-if they explore this? 41:46 Like, you know, MrBeast is probably the prime example. MrBeast Burger was shut down. One trap I could see is just the product experience not being as good. Like have you, have you had a Feastable? 41:55 Like Feastable versus Hershey's, I'm not a candy bar guy, but it wasn't super impressive to me. If their product experience isn't good, they might be able to get customers, but they won't have repeat purchases, so... 42:03 I think pursuing this is a trap for most [chuckles] creators. Like it's, it's really hard. It's gonna take someone really savvy. 42:11 It's gonna take a lot of entrepreneurial resources and organizational capacity, and that's at the cost of what you're doing well as a creator. 42:20 So I think what MrBeast has done very well with Feastable, Feastables, is he has hired a fantastic team, and he's mostly hands-off. 42:30 And I think there are a lot of people who-We get to where we are because we are great at learning and doing, and we just seem to have more time in the day than most people, but there are limits to what you can do. 42:45 And I think most people who explore this route might get consumed by it, and it'll, it'll come at the cost of what they were doing well to get there in the first place. So I, I think it's something you go down slowly. 42:58 I think you find partners, bring them into the business, someone who can make this, like, their focus and, and, you know, make sure you keep your eye on the ball of what got you to that opportunity in the first place. 43:11 Makes sense. I'm glad we talked about some business models that maybe have more synergy than vertical integration, like courses, information. 43:18 You know, if you're posting free content, it makes sense to have some type of paid content, right? So that's a little bit more straightforward, and that's probably the better place to start for most creators. Yeah. 43:27 Where do you see yourself in the long run? It doesn't have to be 30 years, but like five to 10 years from now. 43:31 And the qu- reason I ask that is because creators are not, especially nowadays, like your favorite YouTubers maybe five years ago aren't around anymore. They're not creating content. So do you still wanna be a creator? 43:42 Do you see yourself in a different role? What do you wanna be doing? And how should people think about this in the long run if they, if they're a creator or media company themselves? 43:49 Ultimately, what I want is financial security and complete autonomy over my time without worry. And I think what I'm doing right now is brand building to give me that future. 44:02 But if I'm thinking, like, 10 years from now, I'm going to be producing less content personally, at least less frequent publishing. You know, what I would prefer to do is larger projects. 44:13 I've always en- envisioned myself as an author, and I've thought to this point that the way that I become an auth- author is earning something to say and then having an audience that I can introduce the book to. 44:27 You know, I don't wanna be the author that writes a book and nobody reads it. I wanted to be an author that is supported by his writing. 44:33 And so everything I've been doing to this point is, has been working towards that goal. And I hope, you know, 10 years from now, the majority of my output is actually in, in long form, in long form. 44:45 And maybe books become irrelevant, and it's not about the book experience, but it's more about, like, these more in-depth essays. 44:54 You know, I think about, when it comes to my newsletter, when it comes to writing, I think about people like Ben Thompson. I think about Bob Lefsetz. I think about Paul Graham. 45:05 These people write things that live on and are referenced over time because they are well-written, they're articulate, they live independently on somebody's owned website, and people reference it over time. 45:18 That's the style of writing that I wanna do. A lot of newsletter writing these days is very timely because timely things have a clear value and urgency to look at it, pay attention to it right now. 45:30 I don't really have an interest in building a business built on timely things. That's, that's a treadmill that you never get off of. So I'm, I'm much more interested in creating timeless, enduring, more long form work. 45:41 Love it. I think this is a good place to wrap up. We, we covered so much. Where should people find you? Where do they subscribe to your newsletter, podcast, et cetera? 45:48 Well, if you listen to this, you are the rare person who likes both podcasts and newsletters. So whichever you would prefer. Creator Science is the name of it. 45:56 You can find it in your podcast player or creatorscience.com for the newsletter. Awesome. We'll link that down below. Thanks for coming on, Jay. Thanks for having me. [outro music] Thanks for listening. 46:08 If you enjoyed this episode, make sure to follow the Newsletter Operator podcast on Apple Podcasts, Spotify, or wherever you get your podcasts, and give us a five-star rating to help support the show. 46:18 If you wanna learn even more about how to grow and monetize a newsletter, go to newsletteroperator.com. 46:24 And if you'd like to work with Matt or Ryan directly, check the links in the description and apply to work with our agencies. [outro music]
