Episode 726 | Selling 29,000 Copies, Information vs. Motivation, and Making Your First Level Last (A Rob Solo Adventure)

Rob Walling:
You’re listening to Startups for the Rest of Us. As always, I’m your host, Rob Walling. And in this week’s episode I’m flying solo to bring you a handful of topics that I think can provide you with some motivation or a framework or even a tactic or a strategy to help you grow your business faster. Most folks who listen to this podcast are bootstrapped or mostly bootstrapped founders. Many of them are starting SaaS companies, but there are also folks across many industries including info products, construction, legal, folks who just want to hear the stories, the guidance, the advice. Topics for today include an update on the The SaaS Playbook, sales numbers, and I have some interesting findings and takeaways from those. I’m not just going to rattle off a bunch of numbers, but give you percentages of what channel sold the most and some learnings that you might be able to take away from those numbers. 

I’ll be talking about having access to information versus motivation, and I’ll talk about making your first level last. Before I dive into my first topic, I want to encourage you to check out Discretion Capital. So if you’re a SaaS founder and you are approaching seven figures of ARR recurring revenue and you at some point have thought about selling your company, you should reach out to Einar, the founder of Discretion Capital. You’ve heard Einar on this podcast. He is also the co-founder of TinySeed. Discretion Capital is an M&A advisory for B2B, SaaS doing between two and 25 million ARR, and they get amazing multiples. This is what they do for a living is handle this process for you. And the reason I said if you’re approaching a million is usually even if you’re not at two, you want to start thinking about this 6 to 12 months before you sell. 

You want to get things in order and just understand what the process might be like. You can talk to Discretion. Einar is not a sales guy. He’s not going to push you on stuff. He’ll have a conversation. What is your B2B SaaS business worth? If you’re getting inbound offers already to buy your business, do you need someone who can help give you some advice on what you can do with those? And of course, finding the best buyer for your SaaS. This is where we talk about how once you’re doing 1 or 2 million, you switch from net profit multiples to revenue multiples, and that’s what Discretion Capital does. They are the best in the business at what they do. And of course, I wholeheartedly recommend them, discretioncapital.com, if you want to find out more and schedule a call with Einar. 

So to start with, this week as I’m recording this, I posted on X, Twitter. I said, well, SaaS Playbook has just sold its 29000th copy and I give thanks to everybody. And by the way, if you’ve purchased a copy or you’ve gifted or recommended it to a friend or you’ve given it a shout-out online, I’m super grateful because that is the number one reason the book continues to sell. And I totally appreciate any word of mouth. If you really think about it, across my audience of say it’s about 125,000 people across YouTube, podcast, email lists, whatever, and that’s trying to de-do. But if you just added them all together, it’s significantly more than that. But trying to actually get to a real number of folks that I can reach, I would figure that I would sell 6 or 7,000 copies of a book. And realistically, the Kickstarter sold somewhere around 3,500 copies I believe. 

There was another almost a thousand that was there. So it’s like four grand. And then the first month or two after the book was released, it sold another 2,500, 3000 copies. So it is in that range, that 6, 7, 8,000. The reason the book gets to 29,000 copies is because people talk about it. It really is people talking about it on Twitter, on Reddit. Probably a couple of times a week, maybe more I get an alert from all the monitoring that I have set up of someone mentioning it on a podcast again, on Twitter, on Quora, on Reddit, on other platforms. And that’s really what makes a book like this that is self-published and aside from my audience, there is no marketing engine behind it. I guess there’s a few ads on Amazon. You can buy ads there if you have a book or a product you’re selling. 

But realistically, the reason that it’s about to hit 30,000 is very much because of folks like you who read it, who like it, and who share it. And since we’re a bunch of data nerds, I want to give you this breakdown of copies sold by sales channel because a lot of folks who have never written or self-published a book would’ve no idea. So of all the copies of the SaaS Playbook sold 29,000, 35% of those, just over a third have sold through Amazon, and that’s split evenly, almost 50-50 paperback and Kindle. And realize that Kindle sell for 10 bucks and I get $7 from each of those sales. And then the paperback sells for what? 25 and the printing cost is only a few dollars. And then I think they also take 30% of that, so another 7.50. So I think I get maybe $15 per paperback copy sold. 

Next up in terms of sales volume is Audible with 26% of the volume. So keep in mind 35% on Amazon, 26% on Audible. Now Audible is brutal. They’re a monopoly and they keep 75% of each sale. So I get 25% for my audiobook that I wrote, produced, recorded, paid to edit. I own the copyright and they are literally just a marketplace where I’m listing it and they’re taking 75%. People complain about Apple’s 30% cut and nobody’s mentioning Audible’s 75% cut. Audible will only take, only in quotes, 60% if you give them exclusive rights to sell your audiobook. But I sell it directly on SaaSplaybook.com as well so you can have DRM free, MP3s and I also only pay 3% to Stripe. And so if you don’t make it exclusive, then they take 75%, which is again, just never ceases to amaze me, but that is what it is. 

Third in line, Amazon was 35%, Audible was 26, and my Kickstarter was a quarter of the copies, 25%. So I guess at the top of the episode when I said it was only 3, 4,000 copies, it was actually more than that. So you can do the math easily on 25% of 29,000. Next up is 11% have sold directly from SaaSplaybook.com. And if you’re going to buy the electronic version, PDF, EPUB or audio, it helps me out if you go to SaaSplaybook.com. Now, I don’t think of the books as a major revenue stream but it really does make a difference where when I pay Stripe 3% versus paying Audible 75. And finally 1% Apple Books. I question, I think it’s sold 1% of 29,000. So what is that? 250 copies or something? It’s actually less than that. I question if it was even worth the effort to put it up on Apple Books because it did need some specific conversion that I had to pay a designer to do and then posting it, managing it. It’s just kind of an eye roll. 

It’s kind of interesting how little, I guess Kindle just came in and ate their lunch. I guess that makes sense. So top line sales is best as I can estimate, because some of these platforms like Audible make it really difficult to understand how much you’ve actually sold. But top line revenue is just under 400,000, and my best estimate is paid to me as “royalties” or a percentage of the purchase, about 275,000. So again, I haven’t thought traditionally of books as being a revenue source, but obviously that’s a lot. And that’s a year. Yeah, less than a year since it’s been out. It won’t keep doing that every year, but obviously that is not a trivial amount of money. 

And finally, the breakdown across formats is 43% audiobook. That’s between Audible and selling from SaaSplaybook.com. So 43% audio, 29% print, that’s paperback and hardcover. And then 28% just below it, almost 50-50, 28% ebook, which is Kindle, PDF and EPUB. So yeah, some of the learnings here are Amazon, really Amazon and Audible, Amazon owns Audible. I mean they have accounted for 60% of the sales. And obviously some of those are from my audience who bought it once it came out, but realistically, they really have a stranglehold on the book industry. And I understand why now, if I was a publisher why I would be concerned because Amazon can throw their weight around it and they can de-list your book or they can put the rankings down if they don’t like you, or they can pull all types of pricing shenanigans. So that’s one learning. 

Another learning is that if you are going to write a book, obviously having an audience will sell some copies in the early days. And then what leads to recurring sales where every month you’re selling X amount of copies really is having a good book that people want to share. And that’s not something that each of us can snap our finger and make it magically happen, but there is certainly something to be learned about if you’re going to do this, make it really good, don’t half ass this. I see people who hire a ghostwriter to write a book that they pump at the start for a month or two and then it just falls off the face of the earth. And I ask myself, why did you do that? It feels like a huge waste of time. I guess it’s now a resume builder or something to put on LinkedIn or whatever it is. 

But if I were in your shoes, I would certainly give it my best effort to build something that hasn’t been written before and to make it so good that people want to share it. And a little update on my next book. So I know I’ve talked about the SaaS Launchpad a little bit, which is like the precursor to the SaaS Playbook and it’s early stage ideation, validation and all that. I’m putting that book on ice. It was 75, 80% done. And what we decided to do instead is turn it into a course through MicroConf. So there’s going to be a video course coming out called the SaaS Launchpad, and it’s everything that I know about coming up with ideas and validating them and pre-validating them and building a launch list and all that stuff. And it’s like, I don’t know, 26 videos. It’s very intense. We’re in the middle of editing those now and should be launching that in the fall. 

If you’re interested in that, be sure to either sign up for MicroConf.com’s email list or you can obviously go to this podcast website, startupsfortheresofus.com, enter your info there and you’ll get The 5 PM Framework, which is something I’ve talked about here as well as two never-before-released podcast episodes that you can only get by signing up for the Startups For the Rest of Us email list. But I am about to wrap, it’s about two weeks from when I’m recording this and we are basically doing a, I call it a code freeze, it’s a manuscript freeze on my next book, which I’m co-authoring with my wife, Dr. Sherry Walling and it is about the psychology and the mindset of selling your company. And it’s thinking through whether you should, the pros and cons. It’s dealing with a pressure cooker that is the process of selling your company. 

So the before, the during and then the after. I’ve sold, now what? How do I make sure I don’t implode during any of these times? How do I think through the pros and cons of making all these decisions and how do I come out the other side happy and not someone with 5 or 10 million dollars in the bank who is completely miserable? Obviously the content comes from my own experience, my experience counseling and advising founders for years through TinySeed, through MicroConf, and then Sherry’s experience working with hundreds of clients, many of whom have sold or have evaluated selling and have gone through the painful process. And so we have stories and quotes and our own expertise as well. And I hope to be doing some pre-sales for that later this year, maybe November if things work out really well. So stay tuned for more info on that. 

My next topic for today is a quote that I heard from a running coach. So on Netflix, there is a series called Sprint and it follows runners who are going to the Olympics. It’s 100 and 200 meter runners in the U.S. And both Sherry and I ran track. We actually met on the track in college. And so I love the sport, we both do. And Sprint is an awesome… It’s documentary style where they are following them as they go through the trials and the tribulations. And you can lose a race by two hundredths of a second or three hundredths of a second because your start wasn’t as good and you can be at the top of your game and the former Olympic champion and you can get third because you just don’t perform at the peak all the time. Really good show, highly recommended it. Even if you’re not into running, it’s just one of those things about competing and being exceptional and hard work, luck and skill all coming into play. 

But one of the most winningest track coaches of all time had this great quote in an episode and he said, at this level, you don’t teach them how to run fast. You teach them how to run fast better. And I like that as a metaphor because really this coach won’t take folks who don’t have the raw material and the sheer speed to be able to be a world champion or have the potential to be an Olympic champion. And similarly imagine if you are evaluating a founder to invest in them or you’re evaluating a potential team member. In a perfect world, you wouldn’t have to teach them how to do their job. You just want to teach them maybe how to do their job better, if that makes sense. Or have them teach you how they should do their job better at your organization. Because any of us can hire a super junior person, you could hire an intern and train them up, and then you do have to teach them how to run fast. 

And is that okay? Sure it is. But if you’re bootstrapping and you’re hiring your first 10, 15, 20 people and this person doesn’t already know how to do the job and you’re going to train them up from scratch, unless you really, really need to save on budget, that is a case where you are going to spend a lot, lot of time training them unless you have someone on staff who can train them. Again, if you get to 20 people and you have a bunch of senior folks and you hire a junior, yes, one of those senior folks can train them. But if you as a founder are training them on the nuts and bolts of running fast in their role, the basics of customer success, the basics of customer support, if they’re a successful support person, you’re making your job really hard. And this is one of the bigger mistakes that I made in the early days of Drip, is I hired really junior people and it was, I use the excuse that, well, this is all I have money for and I want people to be local. 

And really to be honest, in Fresno, California there weren’t that many people with the experience that I needed. And especially if I was going to be hiring them and they were a senior customer success person or whatever, probably working for a Bay Area company and making a lot of money. And so there just was no budget for it. But realistically it took a tremendous amount of mine and Derek’s time to train these folks up. And it’s like, do I have regrets about it? I don’t think so. But I think if I were to do it differently, I might’ve hired more remote folks or figured out a way. There are just other ways around it. I know that it was a tremendous amount of time investment at the early stages. And look, I actually love mentoring people. I mean, if you take anything away from me and what I do, there’s a reason I put out 52 podcast episodes a year and now 26 YouTube videos a year. 

And I’m writing it seems like a book every 18 months is that I do like teaching people. I like passing on what I know. And so doing that in a startup, it was very fulfilling to me. And so I actually did enjoy it but the problem was had jumped out of an airplane. And like Reid Hoffman said, we were putting the parachute together. We were building it as we were falling to the ground. And in that case, you don’t want to also be teaching the person next to you how to build a parachute. You just don’t really have the time. And so if I were to do it all over again, I would probably try to find people who already knew how to run fast so I could teach them how to run fast better. 

My next topic is having access to information versus the motivation to learn a topic. I think this was a guest on maybe This Week in Startups or it might’ve been the All In Podcast, I am just pretty sure Jason Calacanis was on it. But it was a guest and they were talking about learning to code and how everyone’s going to be able to code because of ChatGPT and developers won’t be needed anymore. And I just don’t believe that’s the case at all. I mean, we’ve seen the same thing with no-code. It’s like you can build some stuff, but we still need developers to build things. And I think for the foreseeable future, when I look out 5 years or 10 years, we will always need builders and makers and I think even beyond that, but of course it’s hard to predict 15, 20 years of what’s going to happen. But the idea here is that learning to code, the hard part used to be it was hard to find information. 

So when I was eight years old, my parents got me an Apple IIe, me and my brother, and there was one book we got with it and it was called How to Speak Basic to My Apple. And I had learned to speak basic to the Apple because I read through that book and it was painful. You typed in the programs, they called them back then and you made syntax errors and you learned from it. And that’s how I learned to code. And if I had lost that book or the book actually got beat up and lost some pages, it was very hard to find other resources to teach you how to code. But now it’s everywhere. It’s all over. I mean, you can go on a YouTube channel or you can go to any of these teaching platforms like Udemy and Skillshare and you can go to boot.dev, you can go anywhere and you can learn to code for free or for a very low cost, really high quality curriculum. 

So why hasn’t everyone learned to code? It’s because it’s not about access to information, it’s about the motivation and desire to learn it. And I’m not saying this to imply that, oh, people who don’t learn to code are somehow lesser or they’re not as smart, it is nothing about that. Or they’re unmotivated, nothing like that. I’m just saying each of us has a proclivity towards doing certain things and my mind has always worked mathematically. I love to read. I love to write. I’ve loved math and programming. And other people, they are built differently and can they learn to code? Of course. But do they really want to if you force them to learn the code? My kids are this great example actually where I’m like, no, learn to code. Really, you should learn to code. And here you can make video games and neither of them want to do it, and they just don’t have the desire or the motivation. 

And we can also say, what about no-code right? Well, no-code you can definitely get more done without grinding. You basically have kind of a prefab house where the walls are all built and the windows are all built and you’re just kind of pushing them in versus when you’re writing code, you’re crafting your own nails and you’re building your own hammer, and then you’re using that to nail in the nails. And when I asked myself, do I think AI is going to make coding so much easier that you don’t have to be motivated to learn? I just don’t think that will happen. I think we will rely on developers who can learn more easily because there’s content out there because AI can teach them. But to maintain the code and to tweak any of the code and to build something really elegant and maintainable, I guess to say that word again, that’s a skill. 

And some folks will want to do that. Some folks will have the motivation and the desire to do that and others will not. So really what I’m saying here is democratization of information or of training across any discipline, whether it’s code or anything else, does not imply that everyone in the world will soon be doing that. And when I hear folks saying it’s usually the hot take on social media, everyone’s going to learn to code. There will be no jobs, no-code’s going to do it. AI’s going to do it, I just don’t buy it. 

My next topic stems around a quote from John Romero who is the co-creator of id Software and co-creator of Doom and Quake, several other games. The best audiobook that you can listen to him or I guess there’s a physical copy of that somewhere I’m sure, there’s dead tree versions is called Masters of Doom, and I would highly recommend it. I think it’s certainly my top five audiobooks of all time and maybe my top three, just an amazing, amazing story. But John Romero also has an autobiography called Doom Guy. And while I like that one less, it’s still cool if you want to dive into the lore. But one quote that John Romero said in chapter 27 of Doom Guy is he said, “I always make my first level last.” I really like the sentiment of that. Basically he learns the aesthetic of the game, the feel of the game over time and it develops. And he wants to put his best foot forward by the time he’s getting towards the end of developing or designing the game, he has that all in his head and he knows what it feels like. 

He knows what the gestalt is, and he can put his best foot forward in that first level. Instead of you imagine building it first and it no longer aligning with things middle of the way down the line. Or you’re kind of rusty, you’re kind of getting the creeks out, and you don’t want that to be your first level because you want the first level to be a banger. And when I heard that, I thought instantly, yeah, this is why we always created our onboarding last when we build SaaS apps is like, I’m going to build the app. What does it need to do? Here are the pages. Even if it’s a very simple MVP or it’s a 1.0. And then we would think, what steps do people need to take to get on board and to get some value? It is a minimum path to awesome within this app. And that’s when we would then go back and architect the onboarding. 

And it’s the same sentiment here is we already knew how everything worked. We knew the gestalt to the product, the core of it, and we wanted to put our best foot forward. We had worked out the kinks and we wanted to put the tour, whatever we were building, kind of a walkthrough, a thing that prodded you to keep going and get your JavaScript installed and get your first email built and all that. And it really made sense once we had a full picture in our heads of the entire layout of what people needed to do. Now, the interesting thing is I was trying to equate this to marketing too, of like, ooh, write your marketing copy last. Build the app, you’re going to launch it, write the headline after that. I think that’s interesting, I think possibly. 

The other thing though that I think is really clever and it’s something I’ve done several times, which is we’re going to launch a product. I’m actually going to write the marketing copy first. I’m going to write the headline. I’m going to write all the features, and I’m going to bake that down into a long-form sales page. And write it first then go build that product. And that product might be code or it might be a MicroConf offering like Mastermind Matching or what have you. Then usually I will come back and revise that marketing copy. So in essence, am I writing the marketing copy last? Maybe not technically, but I’m definitely using the knowledge as I’ve worked the kinks out as I fully understand now the gestalt of the product we’re going to launch and I come back and optimize and refine that marketing and the sales copy. 

Similar to even sales language and sales conversations. If you’re going to be doing demos, obviously you’re going to develop those towards the end of the product development because you have to learn from that. And of course there’s a lot of iteration that has to happen there as well. That’s all we have the time for today. Thank you so much for joining me. If we are not connected on X, Twitter, find me. I’m @Rob Walling. And if you haven’t checked out The SaaS Playbook, head to SaaSplaybook.com. Thanks again for joining me. This is Rob Walling signing off from episode 726.