A few days ago, David talked about his speech for the WordCamp Barcelona on the post How to Become an Evil WordPress Developer. According to him, his talk was the best of the three presented by the Nelio’s team. And I will not be the one to question that statement ? However, I must say that more people came up to me to discuss the topic after my presentation ?, so I think I also managed to attract some interest ?.
Hence, here is the promised post on my speech. Note that since the speech was in Spanish, some of the slides shown below are also written in Spanish.
My first €100,000 in WordPress – Synopsis
The aim of this talk was discuss how we got our first €100,000 with WordPress plugins, and in particular, how we got our first €100,000 with the subscription service to our plugin Nelio A/B Testing.
Before reaching the €100,000 with Nelio A/B Testing, within Nelio we started offering services of migrations to WordPress. Note that the purpose of the talk was not to explain how you can make money with services related to WordPress, but how to do it with just WordPress plugins and what it takes to start a business like that.
Our motivation and first steps
Nelio’s team currently consists of three partners with a PhD in Computer Engineering (we were 4 initially). When we created Nelio, David, Toni and I were working in the Barcelona School of Informatics, with almost no experience in building startups. Our motivation was basically to create our own business and become rich! ??.
I would say that this point of ingenuity and illusion is key to create and maintain any startup.
How did we start?
The majority of startups begin with an idea that becomes a product, and then the company is created. However, in our case, we started creating a limited partnership without having any idea of what we wanted to do. The only thing we knew was that, given our profile, it would be related to software.
The main advantage of creating a company from scratch without having a previously defined product is that all the ideas and developments that you create belong to the company. Also, the partnership forces a commitment and agreement amongst partners free of conflicts. People feel free to say everything they think before having had any other problems or conflicts of interest.
The drawbacks are that you need legal advice and you have to spend a minimum of resources without even knowing what you are going to do or if you even have the right team.
After signing the documents at the Notary Public office (this is what you do in Spain to start a limited partnership), we had a super brainstorming meeting where we generated up to 20 ideas.
The selected idea: developing plugins for WordPress
After many discussions, we decided that we would develop plugins for WordPress. What were our priorities for making this decision? And what are the implications of these priorities?
We didn’t have money, we didn’t want any external financing at the expense of losing participation or wasting time in the task of finding it. Hence, it was clear that we had to create a business that did not involve a strong investment.
If you have a PC and some other source of income for your personal expenses, you can easily develop software.
Of course, your company will have some expenses and you have to find a way to get some cash. In our case, we decided to offer services to migrate webs from any CMS to WordPress.
We didn’t want to create a hobby, a leisure activity with no intention of making profit. We didn’t want a small business driven by profitability and stable long-term value. Instead, at that moment, we wanted to create a startup focused on top-end revenue and growth potential.
And developing and maintaining WordPress plugins met this requirement.
Nelio A/B Testing
I was very impressed by the quality of this plugin, how easy it was to set up, and the outstanding support Nelio provides. I highly recommend Nelio A/B Testing.
We wanted our market to be completely international. What are the implications? In our case, we started creating the web and the Nelio A/B Testing service only in English.
Currently, our Nelio Software website is bilingual in English and Spanish. This means that the web, documentation, blog, social networks, newsletters, emails, videos we make, our support service, etc., are all in both languages.
And yes, this is obviously more work and, in our case, because English is not our native language, you can notice that we don’t have the English sense of humor that you can find in other places.
The SaaS Business Model
If you want to make a lot of money, a business with recurring revenues could be the best option. But creating a SaaS business is not so easy: you have to define a valuable proposition that someone is willing to pay for.
In the case of Nelio A/B Testing, we decided to offer a tool that improved the conversion in your website. In contrast, Nelio Content is aimed at making sure you save time in creating quality content and promoting it on social networks.
When you create a SaaS business, you need a billing platform for subscriptions, as well as a cloud infrastructure to offer the service.
The use of WordPress is huge and hasn’t stopped growing. The availability of such a great market was another reason why we decided to implement the idea of developing WordPress plugins.
We were rookies here since, for instance, with Nelio A/B Testing we were convinced that every owner of a WordPress website would like our product to optimize the conversion. And the fact is that it took us over a year to understand who our clients really were, after interviewing them directly.
In any case, even though the market may be very large, the real difficulty is knowing how to get into this market. Your marketing plan should include activities in all phases of the sales funnel: acquisition, activation, retention and recommendation.
In the the acquisition phase, we’ve done a lot of different actions to help our potential clients find our products, but not all have worked equally well.
For example, we got the perception that press releases, Google Adwords, and paid reviews haven’t had the desired impact. On the other hand, special campaigns done for Christmas or the Black Friday have worked very well.
In order to convert free users into paying customers, the product must have impeccable quality, and the free version must have limited features to promote the conversion. We also send a list of automated mails reminding the user of the option to subscribe.
In the same way, in order to retain users and ensure they don’t leave, we send mails offering to upgrade from monthly to annual payments with a discount and, of course, we take care of the support service as much as we can.
Finally, regarding the recommendation actions, we’ve offered the plugin for free to some influencers and we have an affiliate program so that anyone who wants to promote our product can benefit from it getting a percentage of the subscription.
Finally, the decisive criterion in choosing what we would do from the more than 20 business ideas that we generated was that we wanted a motivating project.
And what motivates us? That there is continuous learning, and that the product implies a technological and personal challenge. Of course, we are also motivated by the idea of being our own bosses and having the freedom to be the ones deciding how to run the business.
Finally, the ultimate motivation is the illusion of: so what if we succeed?
WordPress has been using “Code is Poetry” as their tagline since as long as I can remember using it (if anyone knows where it came from, I’d love to know).
The slogan has always been very effective at communicating the approach that WordPress takes, a blend of elegant simplicity and infinite expansion. All that lies behind your WordPress install is bits of code strung together like a symphony.
Source: Code Is Poetry by Jay Hoffman
However, we know that WordPress is also a business. And yes, the road is harder than you think, and it will possibly take twice as much as you expected to achieve your goals.
In reference to marketing actions, all of them are important and contribute their bit, but we are yet to find if any of them by itself is more key than the rest.
And note that, just as marketing often focuses on getting new customers, in a SaaS business, it is much more important to retain those that you already have. These are the ones that will guarantee a recurring income from month to month.
Finally, we are aware that getting your first € 100,000 with any product is not easy, you should be a passionate entrepreneur!
Featured image by Jakob Owens.