Wow. What a year.
At the end of last year I made the largest business decision I’ve ever made: stop working on my very profitable training business (to the tune of $20,000 to $50,000 per month!) and instead put all my time, effort, and money into my failing software company.
I also almost entirely stopped blogging and changed my entire business model. This post explains why I did that and the results.
This is my fifth year doing an annual review post. You can read previous years here:
- 2014: http://nathanbarry.com/2014-review/
- 2013: http://nathanbarry.com/2013-review/
- 2012: http://nathanbarry.com/2012-year-quitting-job/
- 2011: http://nathanbarry.com/2011-review/ & http://nathanbarry.com/looking-forward-2012/
I actually just re-read the previous years as a reminder to see where I’ve come from. That reminds me of an important point: these reviews are written for me. Not you.
What I mean is that I write them to provide a snapshot of my worldview, life, and business at a particular point in time. All because I’ve found it’s a powerful tool to see how I change over time.
They just happen to be published publicly on the off chance that you might learn something from it or be inspired in some way.
With that little disclaimer out of the way, let’s jump in.
Books and Courses
In 2015 I spent almost no time on my books and training courses. I did take a week off in both January and May to do book launches for Designing Web Apps and Authority. But those were incredibly focused and limited to just a single week.
They were necessary to continue paying my bills while I focused all my time and energy on ConvertKit (without taking a paycheck).
Total revenue from books and courses for 2015 was $117,394. Not bad at all considering the amount of time I spent on it! I’d estimate a total of 230 hours spent for the entire year (2 weeks of 40 hours, then an average of 3 hours per week). While I’m tempted to make some calculation of hourly rate, it wouldn’t be accurate since I basically just coasted on momentum from 2014 this year.
Ah, I can’t help myself: it’s an average of $510/hour.
Here’s the detailed breakdown of product revenue for 2015. You can compare it to last year here.
Looking at these numbers I see so much missed potential… But I missed out on it on purpose. Letting this business coast down to $2,500/month was the side effect of a deliberate decision to focus on ConvertKit.
Speaking of which, I teased about it at the beginning, so let’s talk about what happened with ConvertKit this year.
In October 2014 I was faced with a critical decision on the future of ConvertKit: Shut it down or double down on growth.
I chose the latter. That meant investing $50,000, hiring a team and working hard on improving the product and reaching out to people for direct sales.
Beyond the decision to focus, here are a few things that made a critical difference for ConvertKit:
1. Focus on direct sales. Content marketing doesn’t work nearly as well for a new product. Direct sales killed it.
2. Find a niche. First we tried “email marketing for authors” (headed in the right direction, but ultimately a bad idea). Then we settled on “email marketing for professional bloggers.” Best decision ever.
3. Concierge migrations. The biggest objection in the sales process for us has always been “but it’s so much work to switch!” So we did the ultimate thing that doesn’t scale and offered to switch them over from their old provider to ConvertKit. Totally for free. Yes it cost us a ton of time an money, but the referrals and ongoing revenue gives it incredible ROI.
4. Hire amazing full-time employees. My friend Danny Iny says that “If you pay for half of someone’s time you get a quarter of their attention.” Ever since then I’ve tried to hire full-time employees for critical roles. When we hire contractors we almost always do it with the expectation that if things go well, we’ll move them to full-time.
So what’s the result of this?
First from April 2013 to October 2014 here’s what our revenue looked like:
Not exactly the shape you want to see in your revenue curve. Then after 14 months of hard work we turned it into this:
ConvertKit grew 71x in 14 months.
Now we have an amazing team of 13 people building and growing ConvertKit who will take us a long ways into 2016.
But in particular I need to thank Marc Boquet, Dan Gamito, and David Wheeler for helping to make that happen. They all took a chance on working for a not-yet-successful-company (sounds better than “failing”). You guys are amazing!
If you want to know more about ConvertKit and what might have caused so many people to become obsessed with it this year (which drove the rapid growth), check out the marketing site and this detailed review from Pat Flynn.
I spent a lot of time last year working on remodeling the house we bought in April 2014. This year I finished a few more remodel projects (painted the outside of the house, remodeled a bathroom, built a chicken coop, etc), but this fall I was able to put all my new tools to work on new woodworking projects.
So far I’ve enjoyed building wine racks, cutting boards, and other projects a lot more than remodeling (though they are both fun). Here’s a sampling of the woodworking projects I built this year:
I kicked off travel plans for 2015 by flying to Thailand and Cambodia to visit my sister-in-law and her husband who lived in Chiang Mai for a year. Hilary didn’t want to come (30 hours of flights with two little kids didn’t sound fun to her), so I made it a short, twelve day trip.
During that time we started in Chiang Mai for a few days, then headed south to the quiet islands of Ko Lipe and Ko Tarutoa. Both were amazing! From there we went over to Siem Riepe in Cambodia to visit the famous temples of Angkor Wat.
Here are a few photos from that trip:
I’ve mentioned it a few times before, but for the last couple years I’ve been into a slightly obscure hobby called travel hacking. Basically you use sign up bonus from credit cards for free flights all around the world. My previous free trips have been to Europe, Costa Rica, or bringing the entire family to Hawaii.
But one of the biggest benefits of travel hacking is booking first-class international flights. You know, lay-flat beds, excellent food, and unlimited drinks. The sort of thing that normally costs many thousands for just a few hundred dollars (and some frequent flyer miles). When traveling with family we’ve always booked coach tickets since 4-6 award tickets require a lot of miles. But this time I was flying by myself…
So for the return flight I booked a first class trip on Cathay Pacific Bangkok to Hong Kong to Los Angeles (and then continuing on to Boise). It cost just 67,000 American Airways miles and $167!
When I called to book the ticket the lady asked if I wanted to know the retail price for this trip. Of course! Who doesn’t want to know how much money they are saving?
Cathay Pacific normally charges $7,000 for this trip. $167 is a much better price.
Here are a few highlights from the flight:
Sometime I’d like to do a similar trip with Hilary. Maybe in a few years when the kids are old enough to leave them with grandparents for a week.
If you want to learn more about travel hacking I’d recommend starting by reading what Chris Guillebeau has written on the subject. He’s used travel hacking to visit every country in the world and taught me how to get over $40,000 in free flights.
- Hawaii (Family vacation)
- North Carolina (Mastermind retreat)
- Las Vegas (MicroConf)
- San Diego (Family wedding, meeting with friends)
- NYC + Nashville (Meetings)
- Portland (WDS)
- Nashville (StoryBrand workshop)
- Virginia (Double Your Freelancing Rate)
- McCall, Idaho (Mastermind retreat)
- Mt. Hood (Pioneer Nation)
- Minneapolis (LeadPages conference)
- Breckenridge (Blogger ski retreat)
The two mastermind retreats and the ski retreat were some of my favorite experiences from the year. If you have close friends from the internet, meet with them in person. All we do is pick dates, rent a big house, and have everyone fly out. It’s really low key. For the trip I hosted in Idaho I just borrowed a mini-van and seven of us crammed in for the 2 hour drive. Nothing fancy.
In our online world I think it’s so important to meet people in person.
Fitness was a big goal for me in 2014 since I had just gotten into CrossFit. Unfortunately I didn’t focus on it nearly as much in 2015. I still averaged visiting the gym twice a week (which compared to a few years ago is good), but I mostly just maintained my strength rather than making progress.
My deadlift and back squat are nearly identical to last year, but I did get a 190 lbs clean and a 180 lbs bench press.
For other movements I got more comfortable with toes-to-bar. I even did a single ring muscle-up. Though I haven’t been able to do one since.
It’s not a huge priority for me.
I did spend a lot of time playing indoor soccer. I started playing about 2.5 years ago and have really enjoyed it—even though I’m not very good. At least now I feel more confident on defense. This fall I played on an outdoor league which was even more fun. I can’t wait for the snow to melt so I can play in the spring.
But in general fitness took a backseat to spending time with family and growing ConvertKit.
Positive and Negative
Normally in these reviews I split everything into these two sections:
- What went well?
- What did not go well?
But this year I listed the major things up above, so I’ll use this section to summarize and mention a few smaller things.
What went well
- Travel. I’d consider this a success. This year was mostly about staying home and working hard. So I got in a couple trips for fun and then attended lots of good conferences. Though I didn’t speak at as many conferences as I’d like. Let’s fix that in 2016. If you run a cool conference, email me.
- Creating things. I’m happiest when I’m building something. This year woodworking was a huge outlet for me and I had a ton of fun making at least half of my Christmas gifts.
- Mindset. I found a note from last year about a goal for this year. All it said was: “fix my scarcity mindset around money.” Despite knowing how much I could earn and what is possible, I found a combination of things last year making me worried about having enough money. I definitely fixed that this year and got my finances back in a solid place. I still have very little available cash, but that’s because I’m reinvesting so much in ConvertKit. Soon I’ll be paying myself more and taking dividends based on profits.
- ConvertKit. My original goal was to take ConvertKit from $1,300/month in revenue to $25,000/month. I thought that would be amazing. Later on I revised that goal to $35,000/month. Then $50,000. Then $83,000 ($1m annual run rate). And finally $100,000. We didn’t quite hit the last goal, but I’m not complaining. We’ll get there next week.
- Creating systems. Now with a full team in place for ConvertKit we create systems for so many common things. In fact, in a couple weeks I won’t have any day-to-day responsibilities for ConvertKit. I’ll still be working a lot on wherever I’m needed, but at least I won’t be the bottleneck on anything anymore.
What did not go well
- Writing. I didn’t write much in 2015. I went from writing 1,000 words a day to barely writing 1,000 words a month. This blog was very quiet. I miss that. One of my goals for 2016 is to start writing again. This 2,000 word blog post is a start!
- Travel. I know, travel was in the what went well category, but I can put it in both places. I had a goal for 2015 to take a random trip to anywhere. Just go to the airport, without a destination, and buy a random ticket. I didn’t do that. I also failed to travel enough to even get the base level of status on Delta. Missed it by one flight. Oh well, not first class upgrades for me next year.
- Stress. Wow, building a company is stressful—and I didn’t manage it well. Between running out of money, early failed attempts to grow ConvertKit, attacks by spammers and attempted hacking there were plenty of things to cause stress. All of this is much better now that I have a fantastic team in place, but it’s something I’ll continue to work on. I actually just started to go to counseling this week to help work through some of this. Which should also help me to be a better company leader, parent, and spouse.
- Product Revenue. You saw the numbers above. Product revenue was at 50% or less than what it could have been. That’s fine and expected, but it still went poorly. Especially since I had gotten used to making large amounts of money without massive payroll expenses. Oh well. I’d far rather be building the company I am now.That said, I do think it’s sad that the training products I put so much work into aren’t reaching the number of people they could. I might put a little time into it next year.
For 2016 my goals are simple:
- Take great care of my team.
- Take great care of my customers.
- Grow ConvertKit 5x.
- Write 1,000 words each day.
- Spend lots of time with family.
- And have a ton of fun.
Expect a lot more written here in the next few months.