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An interview with Yaro Bagriy

This week, I had the pleasure of sitting down with Yaro Bagriy for a 40 minute chat.

Yaro is a Minneapolis-based indie maker, developer, microbusiness hustler, and all-around good guy. He’s the founder of IndieStack, which is a private community for bootstrappers that recently hit #1 on ProductHunt. He also founded Newsletter Crew, a podcast & community for newsletter creators.

 

Alternative Assets interview with Yaro Bagriy

 

I first heard about Yaro a few weeks ago, when I saw he acquired IndieMailer — a competitive newsletter community. As a member of the IndieMailer community, I was really intrigued when I heard about this acquisition. I wanted to find out more about how he made the acquisition happen, and what his future plans are.

 

In our chat we discussed how he manages his time between his different micro-businesses, how he valued IndieMailer before acquiring it, newsletter acquisitions in general, and his take on some industry trends.

You can also listen to the interview (as long as you forgive the brief Airpods malfunction towards the end.) ?


Stefan:

All right. So, thanks again for joining. So, I think to start, I really wanted to understand your micro-businesses. So, you have a few different micro-businesses. You’ve got Newsletter Crew, right? You’ve got IndieStack.

Yaro:

Yep.

Stefan:

And I checked out Evercode as well.

Yaro:

Oh yeah, Evercode. Yeah.

Stefan:

My first question is, how do you manage your time between them all? How do you decide when to ease off the gas pedal on one project and go full steam on another? How do you manage your team?

Yaro:

Yeah. And I mean, that’s a pretty rough question yo because… Like you said, I’ve got Newsletter Crew, IndieStack. Evercode, with Evercode, I’m not really doing to much work on that, it’s really more of a freelancing consultant business. I mean, it does play into this whole thing and I may get into that a little later but at this point, I’m not really doing too much with that. So, that’s more of those on the side things at this moment in time, which at some point I want to build up. And then, I also own one rental property as well, which is kind of like a micro-business in a sense. I just recently bought… Actually, I bought a twin house about six months ago. So, I’m living in one of them and I’m renting out the other. .

Yaro:

And that plays into this whole thing as well just because it adds potential time into this management of time that the question is about. But the way I’m managing time, I mean, it’s… So, basically how it started, I started Newsletter Crew first and this was around… I want to say… If I’m on episode 15… Yeah, around two and a half months ago, maybe three months ago. I probably started working on it three months ago. And IndieStack was just slightly after that, it was almost around the same time as well. But basically, the question is, when do I start the gas pedal on one project versus… And then let it go for another project. And usually, the biggest thing is… When I first start a business, or think of a business, obviously… I’m not trying to start too many businesses at once. I try to start one, get it to a point of plateau, or a maintenance mode, which then after that I’ll start another business and then get that into a maintenance plateau mode.

Yaro:

Which then, after that, I’ll probably start another one, and depending… It all depends on how much time I have. But basically what I did, when I started Newsletter Crew, yeah, I was definitely putting in pretty much all of my hours into Newsletter Crew. And also, just a side note, I’m also working full-time, right? So, you got to think about how much time… Yeah, I work full-time, yeah.

Yaro:

Yeah, it’s hard man. It’s hard. Yeah, what you really got to do, is you really got to be focused. And I’ll get into the time management itself but with a full-time job, I’m working eight hours. Then I got around… Because I got a family as well, and I got a kid. So, you got to spend some time with them obviously, you can’t just be working on businesses all day long. As much as I want to, and the reason why I’m doing all of this is to spend more time with them. And at some point, it’ll roll over obviously and I will have much more time. But at this point in time, I have a solid three to four hours a day, Monday through Friday. Between 10 to 15 hours. And then, on Saturday and Sunday, I also try to put in a minimum of five, five to eight but I won’t stop working until I at least get five.

Yaro:

So, in total, that’s between 20 to 25 hours that I’m putting into my micro-businesses, or my side hustles, or my side businesses. So, when I first started Newsletter Crew, I was putting in all that time right into that, so around 20 to 25 hours just getting the WordPress site up, getting the… The feed is up for the podcast. Understanding how to even start a podcast because this is my first podcast. Looking into all the research, how to use Garage Band, how to find intro music, how do I want to set up the structure? There’s all the pretty work. That probably took a good two weeks. So, at 25 hours, about 50 hours to really just get everything up and running. And obviously, that first episode I did, it took me I think seven to eight hours to find a person to record, edit, publish and then push it out to all my channels.

Yaro:

It was just… The first time, it was much harder and I’ve learned a lot of things since the first episode. So, I was putting the gas pedal on that until I pretty much got it to the point where… I had a backlog of maybe four to five episodes already. I had another four to five already scheduled. So, it was always… I got into this maintenance mode where I just needed to find one person a week, do one interview a week, and then obviously, edit one episode per week. And all of that takes probably around five hours or so. So, there was this big influx, right? And then I got to this maintenance mode of about five hours a week on Newsletter Crew. And that point I started thinking of like, “What’s the next business?”

Yaro:

I’m always big on this compounding thing, right? So, you want to start things pretty early just because you got the compounding effects over the years, you’ll just keep growing. So, don’t… I try to start as many businesses as possible right now that I see myself doing still in five to 10 years. And I was big on this make a community. I get into this into my product hunt post that I just recently launched about a week and a half ago, and I got first on Product of the day. That dives into why I created IndieStack and I can go into it if you want. But basically, at that point, I started IndieStack which is the community for indie bootstrappers, makers, and solo printers, and the indie founders. And then, with that maintenance mode of five hours a day… Or, sorry, five hours a week for Newsletter Crew, I had around 20 hours or so for IndieStack.

Yaro:

So, I’m just putting in all the time… Gas pedal on IndieStack, get that up, and I have to get the… Because there’s a discourse channel… Or, a discourse forum, there’s a discord chat. There’s a custom landing page that I made using Gatsby. Obviously, hook that up to MemberFull and then obviously… This was a process of getting to that point but put in 20 hours or so for another couple of weeks to ramp that business up and then obviously, gets into maintenance mode again. Which is around… I’d probably say around five hours to maintain that. Obviously, get onto the chat to talk to people, reply to people, find new users, or new members essentially to grow the community, write new blog posts, reply to people. So, that’s probably another five hours a week.

Yaro:

So then, that ramped up. So, now out of the 25 hours I have, around 15 hours now, right? Because five hours on Newsletter Crew, five hours of IndieStack to maintain those businesses. So, now I’ve got 15 hours to build the next business, right? So, that’s how I’m doing that. And then, so you’re saying… Or, the question was. The gas pedal. So, I just recently acquired… Actually, I just recently acquired a couple of businesses actually, smaller businesses. One of them didn’t make any money but it was more of an extension onto IndieStack and that one’s been… Taking a little longer just because of the IndieMailer acquisition, right?

Stefan:

Mm-hmm (affirmative).

Yaro:

So, I queried IndieMailer, which is a community for newsletter creators and… That then put all of the gas pedal on trying to do that basically. So, trying to integrate that.

Stefan:

I want to jump in and actually… I want to pivot to talking about IndieMailer because this is really what… On my radar for sure. A little of background, I just recently joined IndieMailer and this is cool but there’s a few things… I don’t know how I should say this but there’s a few things that weren’t quite working for me with that community.

Yaro:

Yep. Yep.

Stefan:

A few things that I think needed to be adjusted and changed, so I dialed back from being so involved in the community. And then, I got that email saying that IndieMailer was acquired and I’m like, “Oh, wow. This is interesting.”

Stefan:

What’s that?

Yaro:

You might have seen this coming, the acquisition, if you noticed the problems with it.

Stefan:

You’d think so, given I live in the world of micro-business acquisitions and it actually took me by surprise.

Yaro:

Oh, really?

Stefan:

I was a little surprised. Yeah. And so, I saw that and-

Yaro:

I was as well. And I’ll obviously get into that but yeah.

Stefan:

Let’s get into it because what I’d really love to know is if you could just walk us through that acquisition, right? That’s really what I really want to understand. What… How did you identify the deal? How did you negotiate the deal? And most importantly, how did you value the business?

Yaro:

Yeah. That’s a good question. Yeah, these are really, really good questions. And honestly, yeah, so… Yeah, we should probably start with the problems that IndieMailer had, right?

Yaro:

And obviously, I was never part of IndieMailer. I knew about it when I started… When I dove into newsletters as my niche of choice, I started a podcast, start building an audience and we’ll probably get into that later on, on why I’m doing all this, what’s the end goal, right? .

Yaro:

But basically, I knew about IndieMailer and I was going to join, obviously. I was going to join for the purpose of pushing out my podcast to that audience, right? So, on the home page it said there was 300+ members. So, I was like, “Okay. That’s pretty cool.” So, I already had 300 eyes that could potentially be looking at my podcast, right?

Stefan:

Mm-hmm.

Yaro:

Within my niche. I was like, “Okay, that’s awesome.” But I wasn’t sure. My thought was, “I could probably do this myself. I could probably start my own community at some point.” Honestly, I already have the audience of listeners, and I had a good amount of listeners per week, and it’s been growing pretty steadily every week as well. So, I was like, “I could probably… I could do this, or I could just build my own as well.” But that thought went back into my mind after I… I was playing around with it. I then forgot about IndieMailer for a while, for a few weeks. I was then looking for podcast hosts, right? Or, guests. So, I go on Twitter, and I go on… There’s Newsletter Crew on IndieHackers as well. And there’s a newsletter board… There’s Newsletter Geeks, there are a couple of other newsletter public communities out there.

Yaro:

And I ran across Terry actually on Twitter, and then I saw that he was the founder of IndieMailer, so I was like, “Oh, that’s cool. I’ll talk to him. Maybe he’ll be a good person to be on my podcast because one, he runs communities so he must know a good amount of things in niche.” So, I was like, “Hey, why not?” So, I messaged him out of nowhere and I was like, “Hey, you want to just be on a podcast?” He agreed. Yeah. So then, we met a couple weeks after that. We scheduled it, we met, we had the conversation. And then we did the podcast but then we had some side conversations later, like pre and post. And I was just talking about how I was thinking of launching a… One, I already had IndieStack there, so I was telling him about IndieStack, and that I’m running this thing, and that it’s getting there.

Yaro:

I think we had around 50 or 60 members at that point in time. And that it’s my first community. And then I told him that I was thinking of launching another community for Newsletter Crew and but I still wasn’t sure I wanted to build up the podcast to a little bigger audience because obviously, with conversion funnel, if you got 1000 people listening, you probably have about 10% interested in joining, and then you’ll have another 10% of that, that actually join. So, I’m trying to get that thing up so there’s enough people talking because no one wants to be apart of a dead community. So, I was just telling him my concerns that I’m still waiting to get this podcast up before I launch but I really like what you’re doing, and from the screenshots, it looks like… It looks like a cool forum.

Yaro:

Obviously, there’s a forum. There’s slack groups. I was like, “Yeah, this is pretty nice.” And he was telling me about some of the problems that he was having with him not having a lot of time to keep up this business, and for him to… How do I put this? It wasn’t as active as he wanted it but he wasn’t… With this life, obviously people do a bunch of different things obviously and this was also one of his many projects. He was just telling me how much… He wasn’t putting enough time into it. So, that conversation after the podcast died down and honestly, I forgot about IndieMailer, and I forgot about the whole community thing. And just recently, this was about two weeks ago, after the podcast, after talking to him, a few…

Yaro:

About a month and a half or… Yeah, about a month and a half or two, or maybe two months went by. No, it was probably about a month and a half went by. I launched IndieStack on product hunt, and this is the big thing that I think took Terry, who was the previous founder of IndieMailer, and then put me on his radar as someone serious to acquire this thing.

Stefan:

Okay. And that happened afterwards, you said?

Yaro:

So, this happened afterwards. So, this was side-launched. I launched IndieStack… Hang on, let me just my calender out. I think it was on the 22nd. So, launched on the 22nd, so I got first, I hit first, and that was pretty awesome. So, I was coasting at one for a while but it’s a battle, right? So, you got to keep getting those up votes. So, I was messaging… I had tons of bullets that I was using. And I messaged my whole email list of all of my… All the people I interviewed on Newsletter Crew. There was a list of 20 people, I just interviewed All of them because I just needed more up votes. And I knew that would score me because they were on the podcast and I know them personally now.

Yaro:

And then, Terry, the next day… It wasn’t on Saturday but the 23rd on Sunday, he just messages me… Replies to the email that I sent him about my product hunt launch and how I was first, and that I would still appreciate any score to keep me there. So, he messages me… Replies to the email on Sunday asking, “Hey man, would you be interested in acquiring IndieMailer?” And I was like-

Stefan:

He reached out to you?

Yaro:

He… Yeah. So, he reached out to me, and I was like… I was obviously taken by surprised. I honestly forgot… Almost kind of… I forgot about IndieMailer honestly. I had a bunch of other stuff with IndieStack, with Newsletter Crew that I was doing. So, I honestly did not see this coming. But he replied to me and was like… At first he said congrats on the community, on the launch, on the success of IndieStack, and it was a really great launch. And we got… I think we had 30 or 40 people join that day, it was crazy. It was really active. And he said, “Yeah, I really… At this point, I don’t really have time.” I think he just had his third child as well.

Stefan:

Was he over it in a way? We see that a lot with people who are selling assets and you wonder sometimes, “Why are you selling? This could be something great.” A lot of the times you find that the seller’s just kind of over it. I remember the first micro-business I ever sold, was a video game retailer, and online retailer video game accessories and I was over video games. I was just over the industry. And so, it’s always interesting to me… That’s a big reason that people sell, that people don’t think, or talk about a whole lot. But sometimes people are just over it.

Yaro:

Yeah. Yeah. And honestly, I kind of got that tone a little bit. I think there was a few reasons. And I think one of the reasons obviously was that he’s hoping… That he’s just had his third child, right? So, he wanted to spend as much time as possible with that child. And obviously, that takes time out of other businesses. You got to pull time from somewhere. And I think from what you’re saying, yeah, he was at that point where the community, even a month a half ago wasn’t doing so well. And he didn’t look like he was too enthusiastic about IndieMailer a month and a half ago, and now a month and a half later, I think he was kind of already thinking like that, “This is the business that I’m going to cut.” Out of the all the businesses that he runs, “This is the one I think I’m going to be cutting just to get that extra time to spend with my family.”

Stefan:

Makes sense. So, how did you guys settle on a price?

Yaro:

Yeah. So, the price. See, I don’t want to get into specifics obviously.

Stefan:

No, that’s fine. Just in general though. How do you negotiate… How do you value a business like this, right? Because presumably, it didn’t have a lot of revenue, maybe some ancillary revenue.

Yaro:

Yeah. No, you’re right. I mean, this business isn’t… I mean, it’s not doing that much money obviously. And I think he only started… I think there’s not even a year. I don’t think it’s even a year old. I think it turns a year in around October, or November. And obviously, it says there was 300+ members but once I actually acquired it, and went in, and looked at everything, there’s only around 130 members.

Stefan:

Active, or total?

Yaro:

Just total. Total. I mean, you can go in too… You’re part of the community, right? You can go into discourse, go into groups, and then you’ll see how many people are in the pay group. I mean, that’s how many people are in the community, right? But yeah, I mean, honestly, we didn’t use any of those types of revenue metrics. I mean, this was during around $1,000… I mean, you can do 19 x 138, or 140. It’s like 1,200 or something like that. And actually, it’s even lower than that because I think there’s like 50 members that were paying $9 a month when you… So, you first start it at 9, and then you raise prices to 19, so it’s actually even lowers than that.

Stefan:

Okay.

Yaro:

So, revenue’s were around… I think around 1,000. Maybe 1,100, or something like that. So, not too much honestly and obviously, the business wasn’t growing, it’s not like… There wasn’t too much activity going on. There wasn’t members joining every day or even every week. At that point, by the time I acquired it, there was maybe around two people a month joining. .

Yaro:

Maybe two or three a month or so joining.

Stefan:

It was mostly flat. So, you have a marketplace… Sorry, a community that’s mostly flat, some revenue. And so, you’re probably using the revenue I’m guessing as a baseline for multiple valuation but then, how much do you factor in the opportunity cost of building something like that yourself, the cost of the audience, the potential of the community in the future? Did you put a lot of pen to paper math with this, or is it just a gut feel, or how did you go about that?

Yaro:

Yeah. I mean, with the business doing such low revenue, I honestly didn’t do any… It would take me more time… I would spend more time thinking about how to price the business than actually how much it’s actually worth. So, I just was like… I mean, at that… I mean, this is a micro-micro-business. I mean, I don’t know, micro-businesses are between five to 10K maybe per month. I mean, this was doing much lower than that, this was maybe 100 MRR per month roughly, or 120. So, there wasn’t really much analysis to do. We just talked it out about the price. I asked him how much he would want, he gave me… I guess say, a price, if that makes sense. And then, I counter offered. Which then he accepted. I mean, there wasn’t really that much back and forth. I think he was getting to the point where he would probably be giving it a way for free almost. I mean, he didn’t give it away to me for free.

Yaro:

He was wanting some money for it but I didn’t want to pay too much either because one, it wasn’t really growing. Two, I think I could have just probably done this myself. I mean, maybe it would have taken a little longer to get up to that in that point of time but that money that he made already, that’s already been made if that makes sense. I can’t really get that money back out. I have to start pretty much from… Any new members that are joining from when I bought, is the money, or the revenue I’m getting. And sure, there’s people that are… How do I say? Renewing subscription, right? And they may renew, they may not renew, I have no idea yet. So, I have no idea what the trend is going to be because the business is so now. But I think the combination of not making… The business wasn’t making that much. It wasn’t growing. His disinterest and not… Yeah, I guess disinterest is probably the best word, in the community, or in that space, he just wanted to get rid of it.

Yaro:

And he said I was the best person for this. Obviously, he saw my success with IndieStack, with Newsletter Crew, right? So, then you just take that and that’s pretty much IndieMailer if you take it all in. I mean, newsletter plus community, I mean, that’s IndieMailer. So, I was like… He saw that I was going to be the best person to take this one. And I think he was really just… I don’t think he was looking to sell it. Obviously, it’s not… At most, this business would probably be worth 2K. Maybe. Which is really… It’s not big business. I mean, and even if you’re paying 2K, you’re paying 2x multiple on a non-growing business, right? Which is pretty… I think that’s kind of standard.

Yaro:

I mean, at such low prices, it doesn’t even matter at that point on how much I pay. That means it’s definitely… It was definitely less than $2,000 obviously. But what I’m trying to say is, I think he was just trying to find the right person to run this thing. I think he wanted to hand it off to someone-

Stefan:

That’s a big part of it. It’s funny. You talk to sellers of micro-businesses and as much as they want a nice price, they want the right sale… Maybe part of it, is they don’t want to see what they’ve built go to waste. It’s like their baby.

Yaro:

Yeah.

Stefan:

Yes, they’re selling their babies so maybe it’s not totally akin to a family member but to the point… I mean, to the degree that they… They still care is my point. They really want to see it in good hands. And I think that maybe he trusted you, and he knew that you were the right person to take it to the next level.

Yaro:

Yeah. Yeah, exactly. I think out of all the people that he… And he even said that, I was the first person that came to his mind and he didn’t even think about anyone else. I mean, he just knew that I was the one to take this business on and move it forward because he knew I would be successful with it. And obviously, that had to do with the podcast makes it successful thus far, with our conversation that we had previously via Zoom for the podcast. The success with IndieStack. I mean, I think all of this together brought me up to that point where he thought I was going to be the best person for this. So, it’s kind of like… I mean, it was kind of serendipitous I guess you can just because I mean, I didn’t… None of us planned it out. I don’t think he was planning on selling it. I think it just kind of happened.

Yaro:

Maybe it was that tipping point where… That product hunt launch that I got first, maybe because of that he was like, “Yeah, I mean, I think this is the right time to actually move this asset over to him and have him take over.”

Stefan:

Yeah.

Yaro:

I mean, I don’t know. He didn’t really go into too much on if he was planning on selling it. From the tonality, I think he was over it, and I think he was looking if that makes sense.

Stefan:

Well, it makes sense for you, right? And that’s the important thing, is it makes sense for you, and what you’re trying to do, and it seems like from the outside, this is perfect. I mean, this is beginnings of building an empire through acquisitions, an empire of newsletter assets. So, what is your plan going forward? Are you looking for me acquisitions and bundling opportunities? What’s your end goal?

Yaro:

Yeah. Yeah. I mean, that’s a good question. I mean, I was going to build this community. I was going to build a IndieMailer-esque sort of thing at some point, right? That was already in my mind. I just didn’t think I was going to acquire IndieMailer if that makes sense. It just happened. I saw the perfect opportunity. And obviously, it saves me time to actually build and a big thing about communities is priming it. You got to prime it’s… You got to get people talking, you got to get things going. You got to have some sort of substance there before you can really start selling it. Yeah, it’s a grinder’s grind.

Stefan:

The way I look at the top community curators, and promoters out there, like Rosie from IndieHackers comes to mind.

Yaro:

Oh yeah, Rosie. Yeah, she was on the podcast. I love her.

Stefan:

Oh, that’s… I mean, she is just a hustler. She’s really inspirational. And shows just how much effort it takes to really create a community but once you get it going, you get those fly wheel effects, it compounds. So, is that your goals, is to really just keep building by acquisition, or do you want to keep building by actually building, or what are you thinking?

Yaro:

Yeah. Yeah. So, I’m thinking… Obviously, in the whole… First and foremost, I’m a software developer, right? So, I do ISO development but I also do web development. And I was into the bootstrapping, even the… When I first started this whole journey, bootstrapping was member of the night. I didn’t really like the DC route. So, I was like, “I want to build a bootstrap SAS. That’s my number one goal. That’s what I want to do.”

Stefan:

Yep.

Yaro:

And obviously, this is a long story that I don’t really want to get into but I ended up deciding that I wanted to be in the newsletter space. And obviously, this will be a whole different discussion.

Stefan:

When did you decide this, out of curiosity? Because I mean, the newsletter Booming right now but if you had the foresight to see that, that’s awesome.

Yaro:

I mean, yeah, I mean, I… I guess… I mean, I don’t know. I mean, probably like six… Or, five to six months ago really. And I already saw it booming already which is probably part of the reason on why I chose this niche to build in. But there’s a bunch of other reasons and the wave of newsletters is going up which is a great wave to be on. Obviously, you don’t want to be on a wave that’s going down.

Stefan:

No.

Yaro:

But I want to build a SAS. Specifically, a micro-SAS. So, I want to build a one, maybe two feature SAS with maybe one… Myself, or maybe one other person potentially. And I don’t even know. I usually like doing solo things. So, I was thinking, “Okay. So, I want to build a SAS. I want to boostrap it. What do I need? I need an audience. I need an audience to sell this.” I mean, this is common knowledge that having a distribution channel… And obviously, Nathan Latka I think his name is.

Stefan:

Yeah. Nathan. Yep.

Yaro:

Yeah. And he’s really big on… Obviously, his thing is building the distribution channel first and obviously… I’ve gotten this advice from a ton of people and anytime that I was building SAS businesses, or any sort of businesses, I was.. First which obviously never worked out. So, I was thinking, “Yo, this time, I’m going to do audience first.” Which is why I started Newsletter Crew.

Stefan:

People don’t realize you can buy audiences, you can buy traffic. You can fast forward in leap frog the painstaking step of building from scratch. And you can often to it at a discount which clearly, you did here in this example. Yeah. It’s just people don’t think along those lines. I think they’re starting to for sure, it’s definitely changing but it’s fascinating. Once you realize it, a light goes off in your head, like, “Wait. I can just buy my distribution. I can buy traffic. Why not?” It’s what big companies do all the time, why can’t I do it?

Yaro:

Yep. And I was always in the thought of you always got to build it yourself. Build the SAS yourself, don’t buy it. And I’m a developer, why do I got to spend money on buying a thing I could just build? Lately, I’m starting to realize-

Stefan:

Do you think that’s because we’re so just ingrained after a decade of just up and to the right, start up mentality, Silicon Valley permeating all aspects into culture, in a good way and a bad way but I mean, it’s just fascinating. People were born to… We’re bred to believe that building, and then growing is just the way to do things. And it’s just… There’s other options. It’s always fascinating to me why people… Why it doesn’t immediately click with people that it doesn’t have to be the route you take. Especially, the VC route as well, right? You don’t have to build from scratch. You don’t have take venture capital. There’s so many other ways to make things happen as you clearly know.

Yaro:

Yeah. And I think another thing is, obviously 10 years ago, or compared to know, people never really valued software. They just thought it was something that just is this… Thing that exists that you can’t touch, or do. But now, especially I think with COVID, people are realizing that, hey, the digital world is a thing that people want to own if that makes sense. And I think people are actually starting to value digital content as something that’s tangible

Stefan:

That’s the term we need to make happen. I think it resonates. But yeah, digital real estate.

Yaro:

Yeah. People are understanding that digital real estate is something that you could probably pay money to acquire in. Actually, it made be a good asset to acquire. It might even be better returns than the stock market, or maybe even real estate obviously. So, what was the question? I’m getting off tangent.

Stefan:

Oh, no. I mean, in general the question was, what’s your end goal?

Yaro:

Oh, yep. Yep. So, end goal is… My end goal is to build a SAS or micro-SAS in the newsletter space. So, I started Newsletter Crew as… Honestly, it was just a distribution channel that I wanted to build, and I wanted to get it to a few thousand listeners and then have something to sell my SAS too but it’s been getting popularity, and I’ve been getting sponsorship deals on that, and making some side income on that. And then, I actually started thinking, “Yo, could this actually be a business in of itself that could be bringing me in a side income, and also distribution channel?” So, could be a distribution channel, I could have sponsors giving me money. And then, just with this IndieMailer acquisition that I’m merging into Newsletter Crew, I’m obviously thinking, “How do I…”

Yaro:

Now, it’s completely a separate business, right? Now, I’m fully thinking of Newsletter Crew as a separate business when I didn’t before but the end goal obviously, is to build Newsletter Crew up as a podcast first and foremost with a community attached to it as a private page community. So, I’m going to have multiple streams of income within Newsletter Crew. You got the sponsorships from the podcast, you got memberships. And I might actually start building out a directory as well and host potential… Like a newsletter directory where I would… Anyone who joins would be put on that directory or something. I’m still obviously thinking about it. But the end goal I guess is to build Newsletter Crew up to maybe 2K MRR, maybe 1K MRR. Right now, it’s probably doing around, I think combined with the newsletter… Or the sponsorships and the memberships, I think I’m doing around two or 300 MRR.

Yaro:

So, not too much but I’m thinking of getting that to at least 1.5 to 2K. I don’t know exactly where it’s going to fall. But also build the SAS to then plug into… Plug that into… Basically, I’m building a distribution channel to plug that SAS into. So, it kind of works as a system if that makes sense.

Stefan:

Very cool. Yeah, it absolutely does. And you’re putting the pieces together of that system right now. And that’s what I love to see. I think that’s… It’s really smart. And I think… Again, this is what big companies are doing, right? They just do it, and it makes news. And people don’t realize that wait… And everyone has the ability to do exactly this, right? Especially now. It’s never been easier. So, really cool stuff. Awesome. So, I think my final question is just about the newsletter industry in general.

Yaro:

Sure.

Stefan:

Obviously, you’re super into it. It’s… I think you picked a great niche to really start to carve out your space in. I think… I noticed that about six or seven months ago as well, it really just started to ramp up. Even before COVID.

Stefan:

Substack is a big reason for that.

Yaro:

Oh yeah.

Stefan:

I don’t know how or why it started to seriously blow up but man, they’re on a tear. And I feel like every, every Tom, Dick, and Harry has a Substack these days. And that’s a good thing though. It’s really… It’s great. It has beautiful writing. It’s a new form of journalism. It’s awesome. I love it. I subscribe to so many newsletters. I love writing my newsletter. I love reading about people writing newsletters. It’s really… If you love writing, you love this movement, right?

Stefan:

And so, I think it’s really… Where do you see this industry? How do you see it unfolding over the next few years? You’re on the front lines of this, so what trends are you watching closely, and which ones do you think have the most legs?

Yaro:

Yeah. Yeah, that’s really a good question. Obviously, I think the biggest thing is, I think we’re… I don’t know if we’re at the peak bubble of newsletter but I think we’re getting there. I think in maybe a year, or maybe year and a half, maybe even sooner, who knows? But at some point, we will get to peak newsletter and we’ll get some newsletter fatigue. And people are… I’m also subscribed to many newsletters but I just started cleaning out my inbox. I’ve been getting way too many newsletters. I was like, “I don’t read any of this. And do I really need it?” I’m really thinking… No, so I think that’s going to be a trend that we’re going to see, is people are actually going to start… Tons of… We’ve got this huge wave of people subscribing to newsletters. People want to start newsletter, subscribe to my newsletter. I got 20 newsletters that you’re subscribed to.

Yaro:

Maybe even more. You’re reading like 10 a day. I mean, at this point it’s like, “Cool. Awesome.”

Stefan:

I think a lot of people are also… I hate to say once COVID ends because we’ve talked about that already but once COVID dies down, I think a lot of the people that had all this extra time that they spent cooped up in their houses, or apartments writing, I think a lot of those people are going to wither away.

Yaro:

Oh yeah.

Stefan:

They’ll consider the newsletter a fun thing they did for a while, and then they just stop. It’s like most blogs don’t last more than a few years. People just give us but this is no different.

Stefan:

But the overall trend is here to stay. The overall shift of journalism from top down media to bottom up expertise, that’s for sure going to stay. I mean, that’s my opinion. I don’t know about you. Where do you see this space going? What trends do you really like? Which ones do you think are here to stay?

Yaro:

Yeah. I mean, I think the trends of curation based newsletters, I think are here to say. There’s such a great value add to curation based newsletters. I mean, as someone who’s apart of many niches, I don’t really have time to be apart of… And running two communities myself, I don’t have time to… I guess be in other people’s communities. Say, the real estate community, or say, podcast community or whatever other niches are out there. But I still want to be in that space and I still want to keep up with the news. I just don’t have time to filter through everything. So, I mean, I’m subscribed to a lot of curation based newsletters and I think they’re going to… I think they’re hear to stay and I think they’re actually going to increase just because there’s a real value add by having someone curate the content for you, and then send that off to X amount of people to read.

Yaro:

I think with so much content out on the internet, I think we need content curators if that makes sense. So, I really see content curation as a big wave that’s increasing, and I think it’s here to stay. Just newsletters in general are here to stay obviously. And obviously, I think we’re going to see a bubble pop if that makes sense, and I think we’re probably going to see a decrease in newsletter subscription and obviously, people starting newsletters. But I think once that bubble pops and equalize I think we’re going to just start seeing it in a slow increase as well. I think another trend that I’m seeing is, I think people are going to be going away from subscription based newsletters. And that’s counterintuitive on what we’re seeing but with this newsletter fatigue, obviously there just isn’t enough money to go around. I mean, how much money are you really going to spend a subscription based newsletter?

Yaro:

I mean, maybe $50 a month? If it’s $5… 10 newsletters at $5 a month. But at some point, there’s a peak if that makes sense and I think-

Stefan:

That does make sense. So, I want to pick your brain on this point because one of the trends that I see which I’m fascinated by is the bundling of similar newsletters. Are you familiar with Nathan Baschez and the everything bundle and what he’s created there on Substack?

Yaro:

Yep. Yep. Yep. Exactly. Yeah, and actually, I’m subscribed to that as well.

Stefan:

I mean, that is fascinating to me. When he first started doing that, probably around March or so, I can’t remember but I was like, “Oh, this is awesome. This is exactly what you want to be doing.” You also want to be the first to do it before everyone tries to bundle up but regardless…. I mean, so do you think that bundling trend will continue?

Yaro:

Oh yeah. I think so. But I really think it… I think it’s just going to continue for… If you’re going to have a subscription based newsletter, obviously there’s going to be… The AD20 rules applies to everything, even newsletter subscriptions. So, I think what we’re going to see is that nice big newsletters are probably going to start bundling up. Just like with the everything bundle. Maybe some of the lower tiered newsletters, we’ll probably see bundling there. But there’s just so much bundling you can really do until it gets a medium based… A medium sort of monetization where no one was really making money… You can’t bundle too many newsletters.

Yaro:

So, yeah, I mean, I see bundling as a thing but I think… It’s not going to take over, if that makes sense. I don’t see it taking over. I don’t think everyone’s going to bundle. I think there’s going to be certain strategic newsletters that bundle, that makes sense to bundle but I think a lot of independent newsletter curators are just going to stay

Stefan:

Do you think we’ll see acquisitions in the newsletter… Of newsletters? And actually, we’re already seeing that for sure.

Yaro:

Oh yeah. Oh yeah.

Stefan:

Yeah. Do you see that continuing?

Yaro:

Yeah. Dude, I think this… And you bring up a good point, that’s a pretty big thing that’s happening. And even myself, I was… I’m thinking about acquiring a newsletter, a newsletter or two just to expand my distribution channels. I think this is going to be a big thing and obviously, Chris Osbourne was on episode, I believe, seven of Newsletter Crew Podcast. He did have two newsletters, or maybe even three at this point, acquired and I think that’s his business. His business is to build up newsletters and then have them be acquired. I think we’re going to see that.

Stefan:

Yep. Well, it’s just a different manifestation of… We live in the world content sites. And there’s this idea of buying traffic. This is basically just a different manifestation of buying traffic. You’re buying an audience, like we’ve talked about. I think it’s a great business model. It’s a great approach. As long as you are properly bundling it, and valuing the newsletter properly, yeah, you can really create a mega audience that way. I think it’s awesome.

Yaro:

Yeah.

Stefan:

Yeah.

Yaro:

Yeah. And actually… Yeah, and just one more thing. Yeah, and I think Nathan Latka’s [inaudible 00:42:22] Was on there. And he was going to sell a newsletter obviously. And it had I think 14,000 subscribers and people wanted to buy it. I mean, this is… I think is an asset class in of itself that we’re going to see as an alternative assets invested.

Stefan:

Yeah. I think so too.

Yaro:

Yeah. It’s an amazing business. I mean, digital newsletters… I mean, newsletters that are digital, that are scalable, that are remote. I mean, this is everything you want. And you don’t need the tech background to start it.

Stefan:

You don’t. You just need to write. Exactly. And I mean, look, at the end of the day, audiences are money. Eyeballs are money.

Yaro:

Oh yeah.

Stefan:

And that’s the fundamental truth of the digital age. So, with that said, I love your approach man. I love the way you’ve been operating. I think it’s super really cool what you’re building over there. I wish you the best of luck, and I’ll be definitely following super closely along with Newsletter Crew going forward.

Yaro:

Thank you, Stefan. Thank you. I really appreciate it. Yeah. This is really awesome for me. I’m just… It’s getting started and . And I really love it, man. I love having these alternative assets, these micro-assets. I think this is the future honestly. I think we’re going to see a lot more people doing this.

Stefan:

I appreciate you coming on. I appreciate chatting with you. I also appreciate you dropping the name of my newsletter probably three or four times during this. So, thank you.

Yaro:

Yeah. I try. I try it. I understand. I understand what to do. Don’t worry, man. But yeah, thanks for having me on. I really do appreciate it. So, thank you very much.

Stefan:

Awesome. Thank you so much, yeah. Take care, bud.

Yaro:

All right. See you, man. Peace out.

Stefan:

All right. Cheers.


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Author

Stefan Von Imhof

Stefan Von Imhof

Stefan von Imhof, a co-founder of Alternative Assets, is also the Head of Product at Flippa - the world’s largest marketplace for buying & selling online businesses. He also created and runs Flippa’s Due Diligence Program, and has bought & sold over a dozen websites. Prior to Flippa he was at HG Insights, a market intelligence company which in 2020 sold to Riverwood Capital Partners.

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