Turning a Side Project into a Six-Figure Subscription Business – Eric Duffett, Shot Pattern

David Barnard:

Welcome to the Sub Club Podcast, a show dedicated to the best practices for building and growing app businesses. We sit down with the entrepreneurs, investors, and builders behind the most successful apps in the world to learn from their successes and failures.

Sub Club is brought to you by RevenueCat. Thousands of the world's best apps trust RevenueCat to power in-app purchases, manage customers, and grow revenue across iOS, Android, and the web. You can learn more at revenuecat.com. Let's get into the show.

Hello. I'm your host, David Bernard, and with me today RevenueCat CEO, Jacob Eiting. Our guest today is Eric Duffett, a high school teacher and indie app developer. Eric is a founder of Shot Pattern, a golf GPS app focused on strategy. On the podcast, we talk with Eric about his journey from failed first app to success with his second, the advantages of building for problems people are already talking about and why he turned down a lucrative acquisition offer to keep building.

Hey Eric, thanks so much for joining us on the podcast today.

Eric Duffett:

Yeah. Thank you for having me. I've listened to every single episode, so I am incredibly humbled to be on this side of the speaker.

David Barnard:

Are you going to listen to this one?

Eric Duffett:

This might be the one I skip.

David Barnard:

Okay.

Eric Duffett:

We'll see.

David Barnard:

And Jacob, always nice to have you.

Jacob Eiting:

That's great. Unlike Eric, I've never listened to an episode of Sub Club, so a complete opposite. I've just been almost.

David Barnard:

All right. Well, I've been super excited to talk to you, Eric. You were on a blog post, you collaborated on a blog post about not selling your app, and that kind of introduced me to you and what you've been working on. I want to step back. You are a high school teacher that built an app as a side project. How did that happen? And yeah, tell us a little bit about the beginning story.

Eric Duffett:

Yeah, more than one app as a side project, and the first one went very different than the second. So I'm a high school teacher. I teach business and app development actually at an amazing Chicago area high school. Back in 2015, I had an idea for an app and no money to pay anybody to build it for me and I said, "Well, I'll just learn how to code and figure it out myself."

So I spent about, I don't know, three months on a Udemy course. Luckily and coincidentally, my high school sent me to a boot camp called Mobile Makers. They actually train high school teachers how to teach app development. And so it was just a really lucky break. They gave me the building blocks to just understand the basics because before that it was just copy paste and like, "Oh, I think it works."

And from there, I started building a meditation app for golfers. As a high school coach, I had seen my athletes struggle and I felt like they needed something to deal with the adversity they were facing in their sport. Many of them were pursuing college scholarships, so I thought like, "Hey, I see a problem. I see that you're struggling and I have a way to help you and I want to build something that can help you perform better, build resilience, build some mental hygiene and mental skills. And so I started creating that app for them.

Jacob Eiting:

I'm smiling ear to ear right now because my whole thesis with RevenueCat is there's a million billion niches that need to be filled with software and meditation for golfers hadn't been one that even crossed my mind.

David Barnard:

So did you start thinking about the app and working on the app before the school thought they would want you to teach app development or what was the order there? Because I missed that when we were talking about this before.

Eric Duffett:

Yeah, they came online about the same time. I knew that it was becoming easier to build apps. I think Swift as a language was very new at that point. I was aware of the Mobile Makers organization and at the same time, I knew I wanted to build for myself. And so I basically got a head start while I was waiting on the school to figure out if we were going to adopt the curriculum and create the class. I'm just like, "I'm just going to figure this out and then if I happen to go to training, that'll be a bonus."

David Barnard:

That's so cool. Then how did things go with that first app? I believe it's called Undaunted Golf.

Eric Duffett:

That's right. Yeah, it was a lesson in what product market fit isn't.

David Barnard:

That's most lessons in product market fit are.

Eric Duffett:

Like I said, I had seen my athletes struggling. I knew that they needed help and it took me basically five years from having the idea to realizing I was wrong to get to the point where I actually sat down with them and asked them, "Hey, I saw this moment in time, tell me about it." And when they talked to me I was like, I guess it was hard, but I don't know. That was essentially what they said. And they had never looked for a solution. They never tried to buy anything. They never downloaded anything. They never asked for help. There was no purchasing intent or really problem to solve in their eyes. And throughout that five years, I had emailed every single college golf coach in the country. Two of them told me I needed to be on Android, so I built an Android app.

I had worked with the design team to redesign the app. I sat in my closet for months on end recording all of these audio scripts and inspirational messages and meditations. And then again, basically five years where I get to the end and like, "Hey, do you want this?" And they said, "Not really." And along the way, there were some signs that other people may have wanted it. I got a couple messages from 50, 60-year-old men who really liked the app. I got a couple of coaches who again are adults that really liked the app, but because I was so focused on that initial hypothesis, I completely missed it. When I conducted those user interviews and they said, "Hey, we don't really want this." I was like, "All right, that's it for me as an indie. I'm moving on. If I'm going to make money with apps, it's going to be because I do contract work or somebody pays me to write code. This indie thing is just not for me."

Jacob Eiting:

It's such a good highlight that learning to build an app is one thing, but building a product is a whole nother discipline. They're sometimes interrelated and often you can be good at both, but they're not necessarily the same thing. One's more human and more data driven and the other is more technical or it's so many stories. It's really an interesting thing. It's often too, the first time somebody builds something that they get it in their call, they believe it's going to be real. And then, I don't know, maybe some combination of some cost fallacy and just belief and just naivete. But this is not the first time I've seen somebody go a long time on something that never really had legs. It's not uncommon.

David Barnard:

What did you do with that app to market it and how many downloads did you even end up getting in those five years?

Eric Duffett:

Yeah. Marketing, at first I thought if you publish the App Store, if you build it, they will come and they didn't come. There was all sorts of issues related to that. Like I said, I was like, "All right, I need to push harder and I need to put myself out there." So I got the email address of every single college golf coach in the country. I emailed every single one, which is over 300 I'm fairly certain, and about five responded and two just wrote back unsubscribe.

It wasn't even like a subscription. I literally copy pasted every single one so you couldn't unsubscribe. It wasn't a mailing list. One wrote back this really mean email. And like I said, two wrote back, "Hey, I need you to be on Android." And I thought like, "Oh, this is the secret unlock." And beyond that, I tried some really weak efforts at Twitter ads and that was really it.

Jacob Eiting:

Yeah. I didn't think it's the core list. Like you said, it's what product market fit isn't. If you don't have a kernel of something of a product, and maybe you kind of highlighted it. Maybe if you had leaned into the couple of people that had wrote in and whatever, but it seems like talking to customers came later, which is, especially in B2C, I think not done enough is talking. It's too easy to, like you said, just put it on the App Store, not anonymously, but almost anonymously and then people download it somewhat anonymously and then you never have to interact with another human. As nice as that can be for nerds, it's so valuable to talk to these people and you learn a lot about what you're doing and what you're not doing and why they're actually using it or not using it so.

David Barnard:

Did you end up doing any consulting? Or I know you ended up building another app. Did you just jump right into that next app and why'd you decide to keep going on a second app after that first experience?

Eric Duffett:

I developed a love for building apps and I stumbled into a problem at the high school that I teach at, and I built an app for the high school and then people saw it and they asked for a couple more. So I started doing side projects, consulting work. They paid me just a little, and then as a second kid came along and I need to make more money. I did pick up some contract work. I even applied for some jobs as a software engineer because the salary ceiling is much higher.

And so I was looking for ways to monetize my ability to make apps and just kind of stumbled into my app, Shot Pattern. It was meant to be just for me. As I started building it, I liked the way it looked, and then I was like, "Well, maybe I can make a little money off this." My goal was to make $1,000 a summer just to justify spending money on golf. Like, "Hey, if I can have one hobby pay for the other hobby, it's a wash, that's all I need." And I found it really easy to implement RevenueCat. I was like, "All right, I'll throw it in the App Store. This is not going to take over my life like the last one did. It is just going to passively sit there and if it makes money, great, but I'm not making the same mistake I made first time."

David Barnard:

What was the idea behind this second app and how is it different from the first?

Eric Duffett:

Yeah. Shot Pattern was born out of my obsession with golf. I had been listening to golf podcasts and learning from golf experts. Essentially there's this idea, this methodology of perfecting golf strategy where you need to go in the course and you need to measure side to side how much room there is to land your golf ball. I'll try to keep it in non-golfer terms.

The brilliant people behind all of the math for how to do this were just like, "Hey, you need to go on Google Maps, you need to use the measuring tool on Google Maps, on the satellite image, and you can measure side to side on the course." They had created this behavior where people were going online and measuring the golf course and I was like them. I was having a lot of fun measuring golf courses via the satellite images, but then I'd get out onto the golf course and I, of course, wasn't disciplined enough to take paper notes or do anything with me. And so I was like, "Wait, everything's a little bit different than what I thought it would be." So I just wanted something real time. Let me measure the hole in front of me. Let me see what the analytics say in terms of proper strategy. It was a little toy for myself at first to just make that process of understanding golf strategy in real time easier.

David Barnard:

This was already a thing, and maybe that's a little bit different from your first app and then this app is that you latched onto something that influencers were already talking about in the golf space, that there was already some kind of motion behind this idea. And then your app, I assume just kind of made it easier.

Eric Duffett:

Yeah, exactly. The creator of this way of thinking, his name's Scott Fawcett. He had been teaching professional golfers. He had his name mentioned on golf broadcast. He had this basically system that he was teaching people for at least five years prior to the launch of Shot Pattern. And so yeah, he had already created the behavior change of this is the way you need to prepare for a round of golf, prepare for a golf tournament, how to think about it when you're on the course.

And so all of these people, all of the content marketing of this is something you should be doing to play better had been done for years in advance of my app hitting the App Store. And that was yeah, like you said, a huge difference in me trying to force a new behavior upon people to just giving them an easier way to do what they already wanted to do.

Jacob Eiting:

It's way easier to write a trend than to create a trend, right?

David Barnard:

You launched the app. How did things go and did it look super different in those early days from the early days of Undaunted?

Eric Duffett:

Yeah. I mean, almost right away it looked different in that one, I was doing more content marketing upfront. I knew not to have the mindset if you build it, they will come. So I built the social media presence a week or two before the launch, before the app was ready and just started putting content out there, engaging in conversations. I continued that after the launch.

Jacob Eiting:

But only a week or two before?

Eric Duffett:

Right.

Jacob Eiting:

It's actually, I would say pretty short. Sometimes you can see people build an audience like months before a launch or something.

Eric Duffett:

Well, I mean, built the first version of the app in three weeks, so talk about night and day differences. Five years of turmoil versus three weeks to v1, like I'm going to put on the App Store even though it's-

Jacob Eiting:

The myth of get rich quick is not true, but it kind of true because often you do something that's not super valuable very long time until you figure out the thing that is valuable and then that is very quick. So in theory, you could have jumped directly to that, but that's sort of in theory. But often when the thing hits, it's fast, right?

Eric Duffett:

Yeah. So I had a little bit of a social media presence. I put the app out there. I started talking about it on Twitter where a lot of golfers like me are hanging out, engaging in conversations. I noticed that every time I added value to the community and dropped some screenshots in there, I'd see a couple trial starts hit. And so it just slowly ticking up, slowly ticking up.

I got a few direct messages from professional golfers on the very beginner level tours. I didn't have to work that hard to get the first downloads to see early signs of monetization. Honestly, one of the best signs that something was working was that people were paying for it that I never heard from. I knew my four customers before. Oh yeah, there's Norm again. But this time, people were paying me and I never interacted with them. I was like, "This is not the same as before. This is working."

David Barnard:

And so in those early days, I know you had a few key decision points of like, okay, it's working, but to take it to the next level, you really needed to start investing into it. What happened there?

Eric Duffett:

Yeah. Like I said, the first version was built in basically three weeks from first line of code to on the App Store. And so it was very, very bare bones. In order to professionalize it and get it anywhere close to what people were expecting, I needed some golf course data. It needed to be aware of where the tee box was, where the green was, point you in the right direction, know how many holes were on the course because prior to that it was just the satellite image from Apple Maps. Wherever you pulled it up, it would just treat it as a golf course.

I poked around and the only way to get this data from a reliable provider was to pay $5,000 upfront. I was like, "Oh, you can't do this again. You got a kid on the way. You told yourself you weren't going to go down this path." And it's like a bad ex-girlfriend calling you back, "I've changed."

I went to my wife and she gave me some really sage advice. I guess it was more of a question, but she's like, "Is this a hobby or is it a business?" And to me what that meant was, again, a hobby is something you spend time on and you spend money on because you enjoy it. A business is something that actually makes money and you have to do all the parts. You don't get to just do the fun parts, you don't get to work on it just when you feel like. It's there, it's something that needs your investment. And so I had to decide, is this going to be something that I treat more like a job or is this going to be something that I have fun with?

Jacob Eiting:

Does your wife happen to also be a tax accountant? Because there are some filing differences between. Maybe that's what she was talking about.

Eric Duffett:

I think she had seen me struggle and justify spending time on something that wasn't going anywhere and was just kind of sick of it.

Jacob Eiting:

So literally the tax code. It's like when something's a hobby versus... And it's a gray line, but I do think not having clarity there is a problem.

Eric Duffett:

Yeah, absolutely. I think she was just like, "What are we doing here?" And kind of tapped out from the first experience. But I decided to go for it, to pay the $5,000 to basically go four grand into the negatives at that point. I was playing golf the next day after sending the money over and having buyer's remorse and I was joking with my buddy who knew what was going on. I was like, "Man, I didn't want to pay 100 bucks for somebody else's golf app and now I'm four grand in the hole. But that turned out to be an amazing decision in two ways.

One, it put a ton of pressure on me to take a big swing at this and to figure out a way to get back into the black because this wasn't something that I could afford to lose money on. The other thing, once I said yes to that small snippet of functionality that I thought I needed, I was digging into the APIs to figure out what else was there to really take advantage of the money I'd spent. I found something else that I didn't know I had purchased that unlocked this additional behavior that nobody else was doing.

And so I started working on it and thinking about it. And it was another idea that a brilliant statistician had popularized. He wrote about in a book in the early 2000s, and I was like, "I think I can do that via an app and it doesn't have to only live in your supercomputer." And so what I did was I basically was able to take a user's data and reflect it back to them and show them an expected value of any shot that they hit.

That was something that apparently people were really excited about because I put it in a tweet and it just blew up more than anything else I had done. It was at that point where things really started to change. Once I put a teaser out there for like, "Hey, I'm in the middle of building this and it's going to be really cool and I think you guys are going to like it." And a whole bunch of people shared it. And after that, I was getting phone calls from influencers and business owners and that was the thing that sent things off to the races.

Jacob Eiting:

Is there golf Twitter?

Eric Duffett:

Yeah.

Jacob Eiting:

Is this in golf Twitter? Because I don't think it would go viral on my Twitter.

Eric Duffett:

No, it would not go viral anywhere. But yes, there's golf Twitter.

Jacob Eiting:

Oh, okay.

Eric Duffett:

And there's a handful of us that hang out there. Yeah, exactly. And so it was this community that I was a part of before as a regular person and had learned what I needed to know, what inspired me to build the app and then just kept on taking these ideas from golf Twitter, from the content creators and figuring out how to make them into an app.

Jacob Eiting:

It's so interesting. People are so much more receptive to things built by insiders for them. Do you know what I mean?

Eric Duffett:

Mm-hmm.

Jacob Eiting:

We call it community, but I think there is just like a new product is such a big risk, not really, but I think it takes a lot. You're not going to pay 100 bucks for somebody's random app, right? But when somebody's from your community and they speak you and they understand your problems, that I think is such a big bridge. And these are small-time kind of guerrilla marketing things. You wouldn't think of an app scaling through just tweets when you're going at the very beginning. It's certainly something, right? It builds a groundswell, builds that base.

Eric Duffett:

Right. Exactly. And I knew that I didn't have the money to do paid. So whatever I could do just to have a little sweat equity to again, to build the content marketing, to engage in conversation. Every little piece was basically free money. It was just effort at that point that took the value add to the community and turn it into a couple of subscribers and things just kept ticking in the right direction.

Jacob Eiting:

And now you can do what I do, which is, "Honey, I'm posting for work. It's work. I have to be on Twitter." At this family engagement, wherever we are.

Eric Duffett:

It doesn't go over real well. So I'm happy to have found another way to grow the app.

David Barnard:

Were you posting this from a personal account? Because I've seen your Shot Pattern account. Were you building all of this on the Shot Pattern account or your personal account?

Eric Duffett:

Yeah, the Shot Pattern account. Everything live there and I toggle between the we and the I and I never know which one to use or whether to use a pronoun at all. But yeah, everything came from Shot Pattern and said, "Hey, this feature is coming soon." And I teased it out there well before it was done, and I knew that I was heading in the right direction.

Jacob Eiting:

It's so funny, when David told me you were on the show, all I could think of is the Shot Pattern logo because that's who you are on Twitter.

Eric Duffett:

Exactly. Yep.

Jacob Eiting:

Very funny.

David Barnard:

How many followers did you have at that point? I mean, I'm just curious for people listening, building in these niche communities, it's just such a great story that finding niche, finding a product that has pull in the market instead of having to push it into the market. And then I would guess it wasn't a massive following that allowed this to start getting traction. So how many followers did you have when you tweeted out that new feature you were building?

Eric Duffett:

Yeah. I still only have about 2,600, so I might've had a thousand and the tweet did again, relative to everything else, did 25 or 40,000 impressions and was shared by several people. Like I said, I had a number of people send me direct messages like, "Hey, I would love to talk, just meet you and see who you are."

One of the people who interacted with that, saw it was somebody who downloaded the app, won a golf tournament the next day in part because they used it. Eventually, that turned into discussions for them being interested in buying the app, as I wrote about in the blog.

David Barnard:

Right. Well, yeah, so tell us that story. Yeah, so you're still early, the app hasn't made a ton of money, but it's showing these signs of product market fit and somebody offered to just buy it out right?

Eric Duffett:

Yeah. They called me up, we had a meeting and our first meeting was supposed to be basically the minute my daughter was born. And so I emailed them at midnight, the night before like, "Hey, I think I'm going to have to reschedule." So we chat a couple of weeks later and they say, "Hey, we really like it. We were thinking of building something like that ourselves, but we really like what you put together. And yeah, we'd like to buy it from you." I was ecstatic for 10 seconds and I realized, wait a second, I don't have a whole lot to go on in terms of what this app could be worth. They asked me to put together a slide deck mainly on the technology that I had used, my tech stack, and then they wanted to know download numbers and number of users.

Jacob Eiting:

Can you describe the nature of the buyer?

Eric Duffett:

I signed an NDA, so I don't want to go into too much detail, but it was a tangential golf business.

Jacob Eiting:

They had been in apps before? They had some awareness of apps, I guess?

Eric Duffett:

Yeah, they had awareness of apps, they had their own app. They saw this, I guess you would call it a strategic acquisition. This wasn't a financial buyer with an app shop. This was somebody who said, "Hey"-

Jacob Eiting:

That's kind of what I was wondering. Yeah.

Eric Duffett:

Yeah. Exactly. They had asked for me to put together a couple of slides of like, "Hey, how many downloads do you have?" And I had listened to the Subscription Apps Report Podcast and look at the reports maybe a month before that. And so I was like, "I don't want to go on downloads. It's still like almost nothing. Let me figure out what I can do here to show you just how well this app is performing."

And so I put together my slides. And so I'm pulling up the trial start benchmarks, and I like, "Whoa, I'm at 25%?" And then trial conversion, I'm at 75% and I'm looking at the charts and it's like, it's off the charts in terms of performance trial, the paid is 17%, and this is an organic audience and there's some juicing of the numbers because of where the downloads from. But still, as I'm putting this together, I'm realizing this has some serious potential and it's really hard to put a number on exactly what this could be.

I talked to a handful of people. I talked to very good ventures who I know you guys know them over there and said, "Hey, what would you pay to bill this?" And they didn't say exactly, but they gave me a ballpark range that was helpful. I talked to a handful of other people to try to get some advice about exactly what kind of a number to put on it, and I put a big number out there and they came back with final offer of 75,000. I sat with that for a while and it's like, "Okay, I can cash in a sure thing and like get a little bit of cushion back or I can keep building because I think I can do that."

One thing that terrified me was in the back and forth, they had said, "We just put this on our roadmap. We are going to build it." And kind of left some blank space there. So read between the lines, either you sell it to us or we crush you. That part was really intimidating to me. I reached out to the Sub Club community, online community that you guys had put together and just said, "Hey, some people are offering to buy my app, but I don't really have any numbers to create a valuation with. Anybody out there gone through this, or can somebody help me?" And Seth Miller of Rapchat chimed in and he sent me a message like, "Hey, give me a call."

As we were talking, I was going through this, he asked me all these questions just so that I could understand how I felt about it. I said, "But Seth, they said that they're just going to build this and crush me." Nobody has ever said the F word on the Sub Club Podcast to my knowledge, and I don't want to be the first. But Seth basically said, "Well, F them, let them try." And I'm so appreciative of him just giving me that little jolt of confidence to be like, "You know what? You built something meaningful. Somebody can't just roll out of bed and put this together. It's going to take effort. And even though you used AI, there's still something here."

Jacob Eiting:

A couple of things I've experienced and seen and whatever on that is like, yes, that's right. He might've been through similar situations with him, I'm not sure, but one that's always used when somebody's trying to buy something because it's like you're usually being acquired by a larger, bigger, somebody with deep pockets, so they probably have a little bit of leverage or whatever, and they're doing a bill versus buy discussion. Unless it's a PE app shop thing, you're just flipping it for the cashflow. So that will always come up as a way to encourage you to do the deal.

For that same reason, is the threat is almost like if they were so motivated and so good and able to build this thing, they probably just would've built it, right? But they didn't, you did. And so because of that, I think it's a bluff usually worth calling, usually, not always. So you probably come up negative on that a few times because that's just the nature of why you do a strategic acquisition. You don't do it for no reason. But then also companies, I think tend to be kind of opportunistic, you know what I mean?

So it's like they see this app, they maybe could get it for cheap, they maybe kind of are interested in doing it, but it's not like the people that are going to work on an acquisition are the same people who would build it. So it's not like, "Oh, we're not going to do the acquisition, so let's go build, let's put those same people on building it." It's different resources of the company, so it's not always lock and step like this.

So lots of reasons why if you hear that threat, whatever you want to call it, you should do exactly what you did, which is take a minute. Kind of creates a similar pressure to buying the database, right? It's like, okay, if I say no to this, it's almost like you walked away from a $75,000 windfall. You're like, "Okay, I got to make more than $75,000 now or this was a big mistake."

Eric Duffett:

And that's exactly what happened next. I had a high for, I don't know, two weeks because the day that I walked away from those negotiations, Golf Digest called and did a little interview. I was like, "I'm off to the races without them. This is great." And then the weather turns and everything slows down, and then I hit reality of like, oh my goodness. I do my taxes actually and I look at what I actually made. I'm like, "Okay, at this rate, it'll take me 75 years to make that money back."

I go from elation to this even greater sense of loss aversion than I had the first time. There were multiple times where I essentially had breakdowns or near panic attacks that I was like, "What have I done? I have so much work ahead of me. I don't know how I'm possibly going to catch up to that number." Meanwhile, I still feel like I have this ghost chasing me of if I don't figure out how to make the app even better, they're just going to replicate it and I'm gone.

Again, during that time, another indie developer was such a huge resource for me. I had heard Curtis Herbert's from Slopes on your podcast. I went over and I listened to basically all of his episodes on independence, and I had listened to his story of how he built slowly over time, and I said, "Curtis, this happened. I'm having major regrets. Should I just sell the app? Or what's even possible here? Is this a realistic number for me to reach in the next three years?"

And of course, he couldn't answer that, but he did give me the calm and the guidance of just like, "Hey, you don't even know if you would've had that money in the bank account. There's a good chance they're going to try to retrade it after due diligence or during due diligence anyway. And so don't get too attached to the number. Just build when you can. Give yourself some grace. You'll have the summer and just slowly plod along and see what happens. But you don't have to do all of this at once. And again, don't get too attached to what you think you for sure had if you had said yes."

That got me to step away from the ledge and it's like, "All right, I'm just going to do what I can and it doesn't need to feel like a race that I can never win." And I just got to plotting and building and adding features to the app that will allow me to raise the price and better support my users and give them more of what they already wanted. And so I just kept plugging away, plugging away, and it took me until basically the end of June, that following summer to release an updated version that allowed me to charge about double what I was charging before. So now the price is 75 bucks a year. Then I started paid marketing, and that's when again, I made another jump because of the marketing efforts.

Jacob Eiting:

When they first approached you, you were barely in the market or you barely made any money, you really didn't have any longitudinal data. Then to wait an entire year later and even just to see a second data point, like I can do things and I can increase something.

Now, you have maybe the same conversation come up, but you'd be much more equipped to understand what that process looks like. I think a lot of people go through this, especially with compounding businesses, is that in the moment, that week to week can look very flat or very erratic. It has to be looked at almost in years to really understand like, okay, is there a compounding motion here? Curtis's business is a great example because super seasonal. I'd imagine you guys are too. Especially in seasonal businesses, you don't see it because you have these massive seasonal spikes and decays and the emotions of like, oh, I made one-tenth of what I made in peak season last month. It's got really drive you nuts, but you have to look at June over June to really see a signal.

David Barnard:

Was it pretty flat that whole time? So from the turning down the acquisition, was money just barely trickling in and you were just like, "oh, crap," for nine months?

Eric Duffett:

Yeah. And so I wouldn't say nine months, but so I say no in October, and then November, December, January, February, things are going down. So monthlies basically all abandon. A few new users trickle in. And now, I'm so busy building that I've really stopped marketing. And so now that's really weighing on me like, how do I spend my time? How do I do all of this? I still have, at this point, a four or five-month-old daughter, I have a full-time job and I just feeling like I have taken on too much.

Then the weather starts to warm up. Some connections I made through the Twitter community, people who already had an audience say positive things about me online and March is great and April's better, and now I'm seeing things pick back up and there's signs of hope, there's a light at the end of the tunnel as I'm finishing up building these new features.

David Barnard:

And so then you release a big update in June and then as you said, started marketing in July. How did things go?

Eric Duffett:

Yeah. Again, that loss aversion, that pressure of I have to get to this number or else I'm going to feel terrible. It stinks that works so well for me. I don't want to go back there, but it really works. So I was like, I have to take a swing at paid in order to hit this number.

I listened to the podcast. I knew I needed to spend the considerable amount in order to get the machine to start working. I try to image-only campaign for a couple of weeks. It didn't really go anywhere. It was about breakeven. And then I was like, all right, I need to try video. It's not really my skill set. I've been reaching out to video creators saying, "Hey, here's a free version of the app. Would love if you talked about it." Many of them were just willing to send out an odd post like, "Hey, I'm just trying out this new app." But a couple of them came back and said, "I would love to put together a video, but it's going to cost money."

So I paid two creators. One, I paid I think 750 bucks because his follower account was somewhat small, and another one was a creator who had done really, really, really well on TikTok who had this really unique approach. And he said, "Hey, I'm going to enter this golf tournament. I want you to sponsor me. I'll put together a video for you." And he asked for $1,500. I thought with his audience that he would likely pay that back pretty quickly because he was getting 50,000, 100,000 views on every TikTok, that that would be the secret unlock. But then I only had two videos, so I had to make at least one more just to fill out the ad set. So very quickly, just so I could get the campaign up and running, I was like, "All right, let me do a screen recording."

So I just pull up the app, I do a screen recording with the first idea that comes to mind. I download CapCut and let it do a thing to make some captions and throw it in the ad set of like, "All right, now I got three, now I can run." And now this guy I had to pay all the money to. Now that ad can go work. I hit go and I wake up a couple days later and I'm rubbing my eyes and looking at my stats and like, "Wait a second. Wait, is this right?" I'm getting installs for like 70 cents with this ad and I'm looking, and it's coming from the one that I made in my basement when I was in a hurry that I checked my RevenueCat dashboard and I look at my average revenue per download is in the 3.50 to $4 range and my installs are 70 cents.

I didn't know this was possible anymore. I thought this went away with ATT. I'm minting money. So off I run to the bank, I tell my wife, "Hey, I'm opening up a line of credit." She's like, "You're doing what?" Like, "Don't worry. We'll be fine."

Jacob Eiting:

Jeez.

Eric Duffett:

I ended up getting an interest free credit card, but I did everything I could to maximize.

Jacob Eiting:

That's still credit by the way. That's still leverage. I just want you to know, just because there's no interest rate, you still owe that money. There's still risk there.

Eric Duffett:

Yeah. It felt like how can I just push this as far as it'll go into the summer and with the spend. And so basically thanks to that last second ad, the revenues from last year, so 2024, ended up being about 185,000. I was able to pay myself $100,000, took it all out of the business and just said, "I did it." I beat the number that they put in front of me. I can't believe that this is how it all came together, but it was a huge monkey off my back to say, "All right, we did it." Now, we can just focus on building and slowly growing and having some fun without feeling like this number is haunting you in the background.

Jacob Eiting:

That's really good. That's really great to be in the green again. You know what I mean? They always were, right? But to be mentally past the checkpoint.

I always... This is somewhat similar, but whenever we raise money, they increase the valuation rate. And I'm always like, gosh, now the valuations way ahead of our multiple, whatever. I always feel better once we're out ahead again. I'm like, you know, which is kind of a mental hack too, to force us to keep pushing because it's like, okay, we kind of wrote a check and we have work to be able to cash it.

Eric Duffett:

That's exactly what I felt, and I'm trying to figure out what to do with that now that there's not really a number sitting out there, but it's kind of like you said, a helpful mental hack to have to push for something and to figure out a way to get there. And yeah, like I said, just an incredible experience to have gotten over the hump and to now be where I'm at today.

David Barnard:

What a cool story too. I mean as a full-time teacher, you made a 100K on the side, hustling an app in the summers, nights and weekends, and what a great thing.

Eric Duffett:

Yeah. I love being able to talk to my students about it. I try to find the balance of how much do I share, what numbers do I share, how much do I work in my experience. But yeah, I feel like an adjunct professors sometimes of like, "Hey, here's how it goes in the real world." It's really improved my teaching. It brings the classroom to life and helps me add some humility into my teaching as well because I'm supposed to be the person who has all of the right answers. But when we do our social media advertising work, it's like, "Okay, if you post it and it does well, then whatever I was going to give you as a grade is out the window. I'm not the one who decides, the market decide. So I was wrong about my own stuff so I can't possibly know for certain that you're wrong."

Jacob Eiting:

We just do the rest of the podcast on business education because I think this is something that MBA suffer from. Not all of them. They've been good to me, but I think when you get an MBA, they're like, I went to business school so they taught me all the things to do in business. And it's like, that's not possible. That's not a thing that exists. Maybe you read some case studies, you saw some things that didn't work, but the only reality exists in the market. That's the only thing that's real.

Eric Duffett:

Yeah. Exactly. And that's what I try to teach them and give them the freedom to prove me wrong if I have critical things to say about their work or just to try to get the real feedback rather than the teacher feedback, pushing them towards not just playing school but actually learning by doing. That's my favorite way to teach a class.

David Barnard:

As you and I were prepping for the podcast, I asked you this question and I thought your answer was fantastic. So I want to ask you, the app has been doing better and better and this year it looks like it's going to be even better than last year. Clearly, you've built something people want now. When are you going to quit teaching?

Eric Duffett:

I know it's a fair question. One, if I didn't work at potentially the best high school in the country, I'd probably already be out of there. The students I have are amazing. They love to learn. I get paid really well. The colleagues that I have, again, because it's a high paying school, attracts tons of great talent. And so I work with really impressive people who are inspiring to be alongside.

I like my job. I was not looking to get away from teaching. We're getting to a point where I should seriously consider it. I'm past 500,000 in ARR. I'm probably going to do over 500, $600,000 in sales, and half of that's going to be net profit for the year. And so it's becoming a very real possibility that not is this something I could do, but almost something I should do to be financially responsible to myself.

But my biggest worry is that my relationship to the work will change dramatically. That to go from this is fun money, this is extra for my family that's going to help us have a cushion to now when I wake up every day, if I see the numbers, this week is worse than last week, I'm afraid that I will never sleep again because I am so worried that all of this is going to disappear from underneath me. I've already felt that when it's on the side and I am just terrified that if it becomes the only thing, then like I said, I will stop enjoying it and it will just haunt me that I'm just waiting for it to fall apart.

Jacob Eiting:

Are you at the point where your time is a constraint on growth? At some point, it's not even about the cash flow. There's a cash flow and right time investment or whatever, but are you at the point where you don't think the nights and weekends can get you to the next level anymore? Or where are you in that journey? Are you still working solo? What's the situation?

Eric Duffett:

Yeah, so I do everything by myself. I do pay some content creators to help me create content, both go to their audience, but I repurpose it as ads. So that's been a helpful way to start basically having other people work on my behalf. But I still, yeah, my time is a constraint because I'm the only developer, I'm the only marketer, and I basically choose between the two and customer support is 30 minutes in the morning and 30 minutes at night.

Jacob Eiting:

That might be something you could bring somebody in to help with. A little bit easier than maybe the coding or marketing and stuff like that. But then again, you're now starting to build a real business. Even that changes the relationship to it.

Eric Duffett:

Yeah.

David Barnard:

It's funny too, when you and I were talking, I was telling you my experience almost the exact opposite is that I spent 12 years, had four kids during the time running my indie app business with constant existential dread, and then I got a job at RevenueCat. There really is something too. The grass is always greener. For me, it has been really nice. My wife even commented after I had been at RevenueCat a year, she's like, "Wow, your base stress has gone down noticeably." And a valid worry. When it is your thing that this is how you provide for your family is this app and there's going to be competitors, there's going to be market shifts. The ad spend might break and you might up 30K that you're not getting a return on.

Eric Duffett:

I've thought about like, "Oh, do I just raise money to give myself a cushion to grow it?" And again, I guess I've realized that I don't want to have a boss in this, and so I'm happy to bootstrap and we'll keep it this way. Whether or not to go full-time on the app is a question I'll have to answer. Luckily, even if my boss listens to this, he already knows that things are going really well. He's not going to be too upset with me for-

Jacob Eiting:

It's a great question to be presented with. It's kind of funny. I wonder if there's going to be any sour grapes from listeners who want this so opportunity so bad and you get it and you're not even sure. But that's how it happens sometimes. I think sometimes I see in the indie hacker community maybe too much of an obsession with the outcome, which is financial freedom or whatever, and less of a focus on just the craft, like building for people and enjoying the process and all of that stuff.

I think you're probably more likely to be successful, maybe it's 51, 49, but I think you're more likely to be successful if you're not doing it necessarily for the money or necessarily for the "lifestyle." You're doing it for the love of doing it and for the fun, and then eventually you're probably more likely to get there. I don't think the asset's any less valuable or interesting as an acquisition opportunity now, probably. So even more so and even probably easier to price at this point, now that you've got a couple of years of data. So I think they're all good options from where I'm sitting. So congratulations.

Eric Duffett:

Yeah. And I just want to turn it back to you and say thank you to RevenueCat, because I really look at what you built as one of the only reasons why this is even possible from like, can I even build something with subscriptions? The first time, it didn't have subscriptions because it was too hard and like, "Oh, a day to implement RevenueCat." That's super easy. And then to know I was making money to turn down that initial offer because I saw the State of Subscription Apps Report and where I was against the benchmarks and to bet on myself to knowing I was running profitable ads.

Throughout the journey, RevenueCat was there to help support me, and my kids would call me or tell me I'm glazing right now. But I really, I mean just sincere thank you because I've been through this unsuccessfully and I have leaned on the tool sets, the community so much as we go throughout this and as I emailed you guys before, like helping developers make more money for me, what that means is I got to take my kids to Disney World.

And before I started building, my wife and I were down to zero. We had an incredibly difficult infertility struggle and we spent everything to get our kids here. And then we're looking at ourselves like, "Do we sell the house? We're never going to go on a vacation again until we figure out something else." Because we got the kids here and we're super grateful, but it might not be exactly what we wanted. And that story has completely changed because of this app and because of what RevenueCat has helped me with. So thank you to the entire team.

Jacob Eiting:

I think we get about 1% of the credit for that. And we take about 1% of the revenue so it's an even trade.

Eric Duffett:

And I would call that a bargain.

David Barnard:

What an incredible story. And as you shared, it wasn't a straight path. It wasn't a rich quick. There were some hard knocks along the way, some really hard decisions, and a lot of stress, but you pushed through and you came out the other side and have built a really cool business. So yeah, as Jacob said, and I'll say it again, congrats. It's fantastic.

Eric Duffett:

Thank you.

David Barnard:

Thanks so much for listening. If you have a minute, please leave a review in your favorite podcast player. You can also stop by chat.subclub.com to join our private community.