Shopify App Partners: What’s Happening Today, Plan For Tomorrow, And Strategize For Growth With Brian Sierakowski Of Baremetrics

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In today’s episode, my guest is Baremetrics’ General Manager, Brian Sierakowski. Baremetrics is a subscription analytics tool that helps Shopify partners understand their business performance by tracking the key metrics such as the MRR or the Monthly Recurring revenue and growth rate to know the best opportunities to make profitable decisions that will promote their business.  

Baremetrics is a platform that can understand how a particular business is doing, what are the best opportunities to grow your business, and what will be the best thing to solve and reduce the churn in the business. 

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What You Will Learn Today:

  • What is Baremetrics
  • How does Baremetrics help Shopify partners
  • Baremetrics as an analytics platform to monitor the business growth 

Links and Resources Mentioned:

Connect with Brian Sierakowski

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So, I don’t know exactly what’s going on here or what action you will take to solve this. But this looks like basically like 90% of your turn all happened three months in. I’m like, do you have any idea what’s going on here? And that was their moment to slap their head and they go, oh, so we have these customers, some customers come to us for a long-term subscription, and some customers come to us project based. And this is most of the projects are three months in length.

You’re listening to eCommerce Fastlane, the podcast to help you build, manage, grow, and scale a successful and thriving company. Powered by Shopify, listen to real conversations with partners and subject matter experts. As they share proven practical strategies, platforms, and the best Shopify apps to help you accelerate your business.

The time is now. Now for you to improve efficiencies, and grow revenue, profit, and lifetime customer loyalty. Please welcome your host startup, founder, and strategic advisor, Steve Hutt.

Today’s show is sponsored by the Bprofit app for e-commerce sellers. Need a clearer picture of your profit margins, or want an easier way to understand your ad spend, or looking for a fast way to analyze all of your Shopify store’s data? then the Bprofit app does it all for you. And like many of our listeners, I used to track a lot of my profits and expenses with all things like a spreadsheet. It worked for a while, my store started to scale up and it simply wasn’t a viable method to accurately measure the profitability anymore. And that’s where Bprofit now changes all of that for Shopify brands.

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Hey there, my name is Steve Hutt. I’m a Senior Merchant Success Manager here at Shopify and welcome back to season five of eCommerce Fast Lane. Whether this is your first time listening or you’re a weekly subscriber. I seriously appreciate you taking time today and listening to the show.

I know there’s plenty of podcast choices out in e-commerce direct-to-consumer marketing. And just the fact that you’re here today means the world to me. And I know it does for my very unique featured guest today. Now, if this is your first time listening, this is an e-commerce show. We have honest and transparent conversations about building and thriving, but what’s interesting about today’s episode is the fact that this is not necessarily tailored towards the direct-to-consumer founder. This is actually a little bit of a paradigm shift. This is actually part of the app and kind of partner ecosystem. So with your Shopify store, there’s a significant amount of apps of all. I think of it as of today is recording, there must be close to 8,000 different apps.

There are some notable app partners and those app partners are typically the ones that I interview here on this podcast and talk about the problems they’re solving. I bring up the comment a lot that Shopify does 80% of commerce extremely well. It’s usually that other 20% that’s typically filled in with an app or a marketing platform, some kind of connection through one of the Shopify APIs to do something else: customer experience, it could be going out to your three PL it could be a data pipeline.

There’s a lot of marketing automation things that maybe Shopify chooses to not work on or have it natively in their solution, but there’s this app ecosystem that allows this customer experience to happen. That’s what’s unique about today’s episode is I have Brian Sierakowski who’s the general manager of a company called Baremetrics and what they are, is there a subscription analytics tool, they help Shopify partners and these app founders, really to understand the performance through tracking the key metrics for your particular solution. I guarantee it’s gonna be an excellent conversation. The show, like I said is not for everybody. So if you’re a founder of a direct-to-consumer brand, today’s show may not be for you, but I know that there is a lot of SaaS founders, people in the app ecosystem that listen to this show because they try to understand what’s the competition doing in my space?

They may have a competing product or thinking about expanding your app into not Swiss army knife, but maybe adding on some more functionality as you’re learning through this podcast. That’s what today’s episode’s all about. It is learning about Baremetrics and what they’re doing and how they’re helping SaaS founders with their growth.

 Hi, Brian. Welcome to eCommerce Fastlane.

Hey, Steve. Thanks so much for having me.

Oh, my pleasure. So I mentioned a little bit the top of the show, but let’s talk about Baremetrics, let’s talk about the problems you’re solving for these partners and SaaS founders that connect themselves to Shopify. Their flag is definitely in the sand of wanting to help merchants.

Those could be listening today, but there’s also lots of people that are like I said, that are SaaS founders that are wanting to get into our ecosystem or are looking to expand their lineup of products or features that are built into their solutions. So let’s talk about how connected to Baremetrics actually helps them.

Absolutely. Yeah. So what we’re trying to do is for in the subscription space, there’s a lot of data flying at you. It’s a lot of acronyms and different phrases that are spoken about to really speak to like how well is your business performing and where might there be opportunities.

And ultimately what we’re trying to do is provide you a platform that you can plug in. Hopefully one click maybe two or three, but really getting you to the point where you can understand how your business is doing, are you growing? Are you shrinking? Are you going sideways? And what are the reasons for that?

And then ultimately I think what we’re all trying to get to is to understand what are the best opportunities for you to grow your business. And that might be something like understanding that there’s an opportunity to reduce churn. Maybe churn is a big issue. Maybe that’s an issue too. It’s a matter of getting more new customers in expansion.

Really that’s what we’re trying to get to is to demystify what’s going on within your business to help you understand where are the opportunities to grow your business.

Excellent. So let’s talk a little about the origin story of Baremetrics because I’m always fascinated. Like why people build what they build.

Sometimes it’s a purpose-built solution and they see that there’s a wider, they, it turns into a subscription product because it has a wider market availability. But I just would like to understand a little bit about how all the pieces came together for the founding team. Like where did the desire and the expertise come from to even want to create this platform?

Absolutely. And it’s really interesting to think about from the lens of Shopify because it’s a very similar story. Baremetrics was formed in 2013 where this was around Stripe and Stripe was a very similar thing where this was this wonderful ecosystem that was coming up that was making it really easy to accept payments online.

The other choices around were really clunky and really painful, like authorized.net and Stripe had this pitch of Hey, within I don’t know what their initial pitch was. Maybe something like within 30 minutes you can be accepting credit card payments online. And very quickly they moved into the space of subscription-based business because SaaS was an emerging trend at that point in time.

And what the founding team at that point in time realized it was like, well, interesting. Like we have this really powerful tool that can scale a business super fast. We can go from where it might have taken us weeks or months to start accepting credit cards. We can build basically over a weekend, we can come up with an idea for a business, build it, launch it have the payment page right there and people can go live with it.

And so that, to me sounds very similar to what’s going on in the Shopify apps market and the same issue at the time existed. It’s okay once you do that, what’s going on within your business? How many people are signing up? How are you growing? How trying to understand the internals of that business?

So that was really the initial problem that Baremetrics was founded to solve. And we’re basically now, taking that same mentality and applying it to the Shopify partner space. Just for me personally, I joined the company in 2020. Anybody familiar with Baremetrics, which is maybe actually not that many people and listening to this, the founder at the time, sold the business, he wrote a really great blog post about it.

It’s still one of our highest traffic blog posts it’s extremely transparent. So if you wanna know effectively any of the details of the acquisition, you can go and read that. So I came on board, like you mentioned at the top, I’m the general manager of Baremetrics. We are owned by a private equity firm.

So I came on board in November of 2020, and I did it to get up to speed very quickly on a lot of developments that had been happening with the product over the years prior to that.

This is really exciting. I’m gonna make sure I have a link to that acquisition cause I think there’s gonna be a lot of people that are interested in that.

There, there were people who are always trying to figure out how they can pitch their product and they want to build it up to a certain kind of level and I think that’s what happens sometimes with some SaaS founders even D to C founders, whereas sometimes the, it builds up to a certain level. But then all of a sudden, maybe they’ve outgrown kinda what they can do individually or as a team.

And sometimes I just require a little more energy and brain power from others who could maybe see a larger vision around the product and have the engineering chops and the marketing chops around it and then that helps push it to the next level. Sharing that information will be very, I appreciate the fact it’s open and transparent about that sort of growth to exit.

And what does that look like? It’s not for everybody, but I guess I’m gonna be devil’s advocate just for a moment because, so if people choose to get their app published on the Shopify app store, which is I think a highly recommended thing, I don’t think Shopify’s too happy about private injections of kind of private apps and things like that.

I think there’s benefits of having a public app, I think from an API call limit. And there’s lots of, I think there’s lots of benefits. I think the biggest one, forget what Shopify is saying the other side of it is just the ridiculous amounts, millions of people coming to the app store every month.

And the potential exposure that can come from it, it’s searchable by category and trending and, even a staff pick, if you’re lucky. Those are very interesting, highly coveted spots to be so getting on there, I think is important. I guess my thought is that is there any kind of solutions built into, I guess the partner’s dashboard that kind of talks about lead pipeline and talks about a few basic metrics?

Is that enough for some founders or is that what differentiates the Baremetrics tool is that you have a much larger kind of like a tool chest sort of thing, or of more metrics and more ideas to help?

Absolutely. So we run into that all the time where we talk with companies and they think they need Baremetrics.

And maybe they come to the realization that either like you were saying, there are those businesses that are in the phase of Hey, we’re just running this. And it’s doing well and things are growing and we don’t necessarily care too many it’s like, as long as everything’s going up, then that’s great.

So we, we definitely exist in like a continuum of especially if you’re very early on, like one of the things that we do really well is to help you subset your customers, and dive in and understand like what is going on inside of your business. For example, if you have five customers and you know them personally, then something like Baremetrics is probably not that useful. because how many useful sub-segments are there of five customers? There’s probably not a lot of insights that you couldn’t like intuit on your own, where we really find that once you get beyond that level once there’s like kind of that there’s like that sophistication gap of as you’re growing. Especially again, based on the amount of time and effort that you wanna put on. If you’re like, Hey, this is something that’s really growing. And I really wanna get behind this. This is exciting. I wanna either build a team around this, or I just wanna let’s just see how far this can go.

Usually, the next question is okay, because I actually did this myself, I founded a company. I run at nights and weekends, and then there was a moment where it shifted. And I’m like, I’m gonna go full time with this. And I remember the moment vividly where it’s I was actually in my basement and it was like Monday morning.

And I sat down in my computer and I’m like, okay, what do I do? What, I’m spending full-time effort to grow this thing, what’s the thing to do? So that’s really where Baremetrics can come in to be an invaluable tool of understanding like, okay, what are the opportunities in front of us?

Which includes, first of all, where are we today? What’s how much MRR do we have? Which is monthly recurring revenue, which we can do a little primer on those terms too. But it’s basically what’s the overall financial benchmark of the company, financial health of the product? How fast are we growing?

What does our churn look like? And then going down to subsets of if you offer multiple plans or even multiple products, like which one of those is growing fastest? A lot of times when you look at the total number, you get an averaged view, obviously, because it’s the average of it. If you look at your churn number and it says 5% churn, that’s 5% averaged across all of your customers.

What if there’s a segment of customers that only churn at 1%? That’s probably pretty good to know. You might wanna invest there. And then conversely, what if, on the other side, there’s a segment of customers that turn at 20%? Oh my goodness. What’s going on there? If you can turn that 20% into a 10%, then you just doubled your growth rate.

So that’s the kind of question, usually, people will start looking for a tool at that point because they’re, they realize that they don’t have enough information in front of them. Maybe they realize that they personally don’t have the skillset and the understanding of the SaaS space.

Although that usually is not a blocker because even people who do understand how to do these things don’t wanna do it by hand. They don’t wanna like manually create a tool for it. So that’s generally where it makes sense to go to Baremetrics. And there are certainly people that are before that, where it’s yeah, there’s not the answer to them usually, because we talk with everybody, who’s willing to talk with us when they sign up.

A lot of times the advice to them is ‘Hey, we’ll either just spend a bit more time on it or get more customers,’ like that’s what your dashboard says is you need more customers. Which you probably already knew that’s like kind of good feedback for them to understand just from a high level of there’s a, there’s definitely a tipping point where it’s okay, Baremetrics good from being something like, oh, I don’t know if I need to pay for this to, oh, this tool like pays for itself 10, 20 times over every single month.

Yeah. It’s interesting. Like I said, I mostly interview these SaaS and kind of marketing platform founders on here. Cause they’re solving some very unique problems, but usually at the end of the show, we talk about, Hey, what’s the listener-only promotion or bonus that you like, what’s the call to action. Now that you’ve shared your thought leadership around your tool and kind of what you’re doing. And usually, it’s some kind of a free trial or some kind of a discount that’s applied maybe after onboarding and stuff like that.

Is there any kind of like trial insights or anything built into the tool? Because for me it was like, it would be so interesting to be able to track and say, Hey, because we offered a 15-day free trial and we followed those customer cohorts through their customer journey on our, as a potential customer versus maybe offering a longer trial and some better onboarding or so I’m just curious in what your mindset is and the tool could help from a trial perspective equals better lifetime value for someone who wants to use your Shopify.

Absolutely. So we do have a feature like that built in it’s literally called trial insights, like you said we actually have a lot of, especially on the Shopify side, we have a lot of roadmap around that because yeah, we agree. We Baremetrics just went through a big round of price testing and using trial insights was like critical for us to really understand like, yeah, what’s going on. To us, we weren’t changing the trial length, but we were changing like the offer price. So it’s like, all right how does that affect our funnel? And the thing that’s tricky, both from our side. You, I’m thinking from a product perspective, but also as an operator trials are obviously, it all happens over time. There’s always like a rolling period of okay if you have a 14-day trial and you put that up, then you’re not gonna, you’re only gonna see your first cohort of people go through that 14 days and then, so really you need to probably run that for six weeks. So you have three cohorts and then you need to measure it for eight to 12 weeks. The other thing that we find is that we talk to any business this is across all subscription businesses and we’re like, oh, what’s your like average conversion time.

Like before they sign up, just ask them. Oh, we have a 14-day trial. So the average conversion date’s probably between probably right around 14 days. Sometimes people sign up early. Sometimes people sign up a little bit later and then we’ll look in their account and be like, oh, it’s actually closer to 60 days or 70 days just because it’s you have people that start a trial and leave and come back, like within Baremetric, we’ll have people that especially if they’re bringing their own data to us, it might make sense that we wanna give them a trial extension. Although as an operator, I hate trial extensions. Sometimes it’s we allow people to fully, this is going a little bit deeper into the product, but we allow people to fully enrich all the data.

They can bring their own. Product data into to Baremetrics so they can create their own segments and things like that. So sometimes it makes sense, and I can’t argue with the success team that we should do on the trial reset. And so all these things happen and then that’s the case for us.

I think our average conversion length is like 50 days. So again, this is like another thing. There are all these different like gotchas. And if that’s true and we go through and we audit that if your average conversion time is 50 days and you’re running experiments and you’re expecting to see results in 14 days, Then even if you are putting a winner out there into the market, you’re not gonna see that.

So really a lot of it comes into this full awareness of like, how does your business work? And maybe you do. I’m sure they’re, and I know for a fact I’ve seen businesses where their average conversion time is like less than their trial. The reason for that is that they’re doing a lot of incentivization during the trial to say Hey if you sign up now, we’ll give you this.

Or they’re killers from a product marketing perspective of like that. The minute that customer gets that wow moment of using the product they’re there and like, all right, put your credit card in right now so not to say that it can’t happen, but again, this is that might be something that would be really beneficial for your business to do.

There’s also a list of like probably 10,000 things you can do. So again, this is where having the full dashboard of understanding the ins and outs of your business can really shape what, where you’re gonna spend your time and what the biggest, like ROI from an effort perspective, is gonna come.

Okay, so maybe walk us through now, like what happens? We have a SaaS founder listening now. They’re doing some kind of a spreadsheet-y thing on their own right now, or they’re just looking at the partner dashboard and they’re just kinda like making their own hypothesis. What happens when they add Baremetrics to, let’s say they get a trial and they give that a whirl. Does it, what sort of, just walk us through the process of ingesting the current act of subscribers? The current people in, I guess I just wanna completely understand or share with everybody about what people can reasonably expect once they connect Baremetrics.

This is an area that we really focus on and we try, of course, there’s always exceptions but the flow should really be. You sign up, you create your Baremetrics account and then the next step will be like, Who’s your payment provider where like, where are all these subscriptions stored? And you’ll be able to select Shopify partners at that step. And then we will connect to your Shopify partners account.

And then from that point, depending on how much data you have, that’s when the computers are going beep-boop-boop-beep-boop-boop. On the back end, doing all the calculation. You know, we try to make that process as fast as possible, but that can be limited by API request limits and things like you were alluding to earlier. But anyway at some point we’re gonna reach back out to you and say Hey, your data’s ready, and then at that point, you show up and we have 26 different metrics from your MRR. Your AR is an obvious extension, that, your churn rates and all of this segmentation, everything at that point is live and ready to go. And what we also do is we reach out to you. I think. I guess there’s a lot of SaaS companies out there that take this approach.

But what we really realized is we do have customers that go through self-serve and I think it makes sense, especially if you have a lot of experience in the space. I think, especially for Shopify, what we notice is that not only is this a new product and a new experience, but it’s also just like a new domain. And we were joking it’s we talk to Shopify customers they’re like, oh, this says our, MRR is a hundred thousand. I’m like, yeah, it’s great. They’re like what’s MRR? It’s oh, okay. We need to step back assign. And I think that when we work with companies too, we really help them because a lot of people interact with these metrics at a high level, but you kinda have to understand like, All these metrics have a purpose and they have a use. And so for example, If you’re using MRR to forecast how much money you have in your bank account, that’s not right. You’re gonna run into issues there.

We reach out to everybody who signs up for a trial. And if we could, we obviously don’t get a hundred percent take rate, but we would love to walk everyone through, talk to them, basically have a conversation like this. It’s Hey, what’s your, what are your objectives? What are you trying to do? We’ll look at your data and we’ll give you our initial feedback. Like we don’t know your business, but for example, I’ve done this for customers. We’ll go to, we have this churn cohort chart, which basically just shows you over time. Like when in the subscription do people churn and I had one customer that I was talking to where it was like, right at three months, there was this wall where they had 90% retention up until three months. And then like after four months, they dropped down to 30% retention and I’m like, That’s crazy. And so that’s something you don’t see in churn percentage because that happens over time.

But looking at it in that different view helps you understand that. And I was able to go to ’em and be like, Hey, I don’t know your business. So I don’t know exactly what’s going on here or what action you’re gonna take to solve this. But. This looks like a pro like this, like basically like 90% of your turn all happens three months in I’m like, do you have any idea what’s going on here?

And that was their moment to slap their head and they go, oh, so we have these customers, some customers come to us for a long-term subscription, and some customers come to us project based. And this is, most of the projects are three months in length. And so what they wound up doing is, they created a new product offering for the product, a project-based customer.

I think they did. It was like up to six months, but they gave them a better price or whatever they figured out all the details to accept the fact that they’re gonna lose their customers. But what can we do to one, make it a better experience because signing up for a monthly tool that you’re only gonna use for three months stinks, but also for them it’s losing 90% of their revenue to churn every three months when it’s I think they also had things like having access to the documents that were created. There were a bunch of things that they could do after the project. So that was really their impetus so the kind of bottom line is they knew that this was a, something was going on in their business, but seeing it the right way that immediately brought it from like number priority, number 12, to priority number one in their business. And they turned things around after that. It was really incredible, that’s why I bring them up as an example. I said one thing to them, and then they didn’t like, the hundreds of hours of work. And then but I get to take credit for that. So it’s good for a podcast being like, yeah, I said one thing and they like doubled their revenue over the next couple of months.

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And I could see it. I could see one thing that would be really helpful for a SaaS founder knowing approximately when you’re gonna churn and then thinking about like what’s my education or drip sequence that’s happening in the early days? And then getting CLO it’s just like a DTOC founder if especially a subscription, DTOC founder unless you’re selling supplements or something. And then all of a sudden or contact lenses, whatever it is. And all of a sudden that the typical customer only lasts a certain amount of time. It’s what are you doing? And it’s like a life cycle marketing. How, like, how do we deal with the at-risk customers that are gonna be churning soon and what sort of incentives or education? But I guess what Baremetrics is doing is just helping the SaaS founder identify the fact that this is your first-party data connected to Shopify, this is the reality, not just churn percentage of total revenue and all that. This is like exactly the dates that kind statistically relevant dates of gonna when the bulk of people are churning and knowing that then there’s gotta be a playbook around here’s some things that you may want to do to help alleviate some of that and that’s what you were just mention.

Absolutely. It’s always a what and then why. Okay. What’s going on within the business? What’s the number what’s going on here? And then why is it happening? Like you said, around churn really like outside of Baremetrics or what just like generally in business, it’s one thing to say so the first thing we get is our churn is too high. I’ve never met a founder that thought that their churn couldn’t be low. , it’s just it’s like always a thing. And you’re usually right. This is why I think people say that, okay first off let’s quantify. What percent churn, what revenue churn or user churn? Like those are two different metrics that we have, and it, how you look at it also depends on who you are as a person and also how your business operates. And it’s okay why is that churn happening? The example that I gave before of this is where being able to segment out your data is really important because there’s probably multiple reasons why people churn. And if you can see, buy different product or buy different type or even buy size of customer. Hey, maybe your bigger customers churn for one reason, your smaller customers churn for another reason, it’s what’s the math breakdown on that? Do you have the same number of big customers turning and small customers churn? It’s then you should probably solve the issue that causes the big customers to churn because it’s, irrelevantly usually what’s happened is okay, we. $1,000 a month turn, and then we have a hundred dollars a month. So it’s then you have to subdivide between the two, but really understanding. It’s what is going on. And then why is it happening? And then you can usually it’s if we can we take our customers all the way up through the why. We can’t tell them, how it would be next now, how do you solve this, but usually if you say to a business owner, an operator, here’s, what’s going on, here’s why it’s happening.

 

 They’re already filling in the how-to fix it because they know their business so well and they understand. And I think the people that we work with already have that sort of to, to get into the space. You solve a problem and you took all the effort and all the challenge to. To solve a problem. So when we give you a very well-defined problem to solve, usually they’re off to the racist to solve it.

I have another question about, and it’s related but, about forecasting, because I think that could be a very interesting metric. I know that you have some kind of forecasting section, but just maybe you can unpack that. For these app developers, like what does a forward-looking insights? Like, why is that important, and then how can founders like action, this forecasting data?

Yeah. So this is something a little bit special that we do most of them or actually like really any analytics tool. You look at Google Analytics or any sort of things. In our space, the financial analytics space, it’s like most of the tools, except for Baremetrics, they look at just the revenue side. So what money are you making? Upgrades, downgrade turn so on, so forth. And they look at just the past. So it’s here’s the trend. And here goes up to today, but it’s okay What’s gonna happen in the future? And I think generally the reason why most tools do that is because predicting the future is very difficult to do. So we actually did an acquisition last year of a product called flight path and flight path looked at, looks at your whole kind of business health.

It’s your full like P and L and balance sheet and cash flow state, and all these kind of accounting terms that like most people don’t really interact with on a deep way, very frequently. And so we found that the combination of we can take all of this sort of intelligence on your subscription metrics, like the what and the how, and to get you the why, and then we can send that through and say, okay, How is that going to affect your revenue and how is that gonna affect your expenses? And then what’s your cash flow gonna look like to move forward? Cause what we really realized, and one of the things that drove us doing the acquisition is first off we use flight path and historically Baremetrics almost ran out of money and Baremetrics used flight path to get back on track to then go on to be sold. So we already had our eye on it. Hey, that was really damn useful too but using. So again, like it just was that natural evolution of how can we go further again, we’re already in that spot where we are meeting with every company that signs up, we touch base with all of our customers.

We are there to help them go deeper and make more is kind of our catchphrase. So like how can we have them make more? So we found that kind of the natural evolution of that is okay, so let’s say that you, we just gave that example of okay, we, we’ve learned when customers are churning. We realize why it is maybe the solution that would work best is to maybe the number one, I’m doing a lot of maybes here. Maybe the reason why people are churning is that they don’t understand how to use the product. And they’re not getting the full value out of it. So they say, Hey, this is way too expensive for something that just does X, Y, and Z.

And if you understood how to use the product better, you would realize that we do way more than that. So the solution is maybe hiring a full-time success team, Maybe two, and so a lot of times, just on the Baremetrics side, we come to conclusions like that. And the founder would be like, I don’t know if we can afford that, or they might just say straight up, we can’t afford that. So what’s the next best thing we can do? And so using something like flight path, have we have all of our revenue numbers brought in, if all of our expenses and everything is forecast in the future, then we can use that to say what is your cash statement?

Look, what does your cash balance look like? If we hire two people, what does that look like? What does that look like? If you hit your goals? What if that looks like if you don’t hit your goals, what does that look like when current so it’s really like that next piece that’s critical of we thought we were doing something really special with Hey, we’re not just delivering you the numbers, we’re actually telling you what’s going on and giving you something actionable, but then it’s then there was another roadblock of okay, Are we gonna run outta money? And I think especially relevant now, especially since we are owned by a private equity firm. So we have a lot of people at the board level. The private equity firm that is looking at macroeconomics, the whole situation that’s going on.

It’s a lot of doom and gloom. We see a lot of layoffs already, and every time we see a popular layoff in the news where like they should have been using flight path because they would’ve seen this coming. You. Way before they need to get rid of all these people. So it’s like the final step of you have all the, understand what happened in the past. You can really deeply understand it. You can get some different trajectories into the future, and then you can actually plan moving forward if okay are we gonna hire? Or even just like at spend when we sponsor a podcast or a newsletter or whatever, we bring that into our model and say, This isn’t gonna take us cashflow negative. And then we can say, we can create a scenario around that where we can actually go through the process of, okay, we think we’re gonna sponsor this podcast. And we think it’s gonna have this effect on our revenue. we, and then we can test to see like we can always, and then we look back. Historically from that too, we do a forecast versus actual, did we actually hit the numbers? We thought we were gonna hit so on and so forth.

Yeah. All right. Thanks for sharing that. Cause I think that’s a really cool feature. I just, wish that the forecasting model was available for direct-to-consumer brands. So those listening on the show today, I think about that. Is there ways of analyzing your first-party data and helping DTOC founders think about where things are headed, but I know there’s lots of variables of supply chain and different things, but putting all these variables together is very interesting? I could see the application for that.

 And the good news is that you can use flight path without Baremetrics so if there’s somebody who’s not in the subscription side and we do actually have because we acquired the business. So we. Companies, all over the place. We have some that are in the SaaS space. We have some that are publicly traded companies. So we have people all across the board subscription non-subscription so we can help with that. Obviously, probably the first thing we’re gonna tell you is Hey, be smart to look into a subscription model, just because we believe so much in that, but you can get everything from because that the forecasting side, the data sources are your accounting system. So you QuickBooks online or zero. That can be the starting point. And then we need to help you create the revenue forecast and so on and so forth. An option there too if you’re on the subscription side, especially with these big ad budgets and acquisition costs, and you wanna make sure that you are in a strong cash position, especially over the next three to six months, where fundraising might be more challenging. You might need to look at debt financing or something like that. Perfect option for flight path there.

Very cool. So it’s flightpathfinance.com for those listening. So you can, I’ll put that in the show notes and stuff. So another question that I have is talking about maybe the competition in the same space. Shopify obviously has their own at least, basic kind of analysis of current active subscribers and some basic revenue numbers and things like that. So the, and I think that’s a really good starting point. And I think if you do a Google search and stuff, I’m sure there are other notable peers that are here to help SaaS companies in just building LTV at other customers and trying to avoid churn and Dunning and all these kinds of fun things that you can do. And so I just would like to understand a little bit about Baremetrics, like how, or why have they been so intentional to differentiate. Maybe more specifically in the Shopify world, like why are you uniquely positioned to help SaaS founders?

Sure. Yeah. And we’ve already spoken to a lot of it already. So one, everybody no one else in the space is focusing on Shopify in the same way that we, or at least. I should say, there are some solutions out there that are specifically focused on Shopify, but they’ve been created relatively recently and they don’t have the years of experience that we have in this space. You and I were talking before. It’s like when I first started at Baremetrics, had the thought too of, Everything that we’re saying, it’s it doesn’t sound simple, but it sounds like a relatively straightforward process of Hey, if you wanna know what’s your monthly recurring revenue, like how much money should you expect to receive based off of the contracts that you have on a monthly basis, and that turns out to be like a really complicated question. You have some number of hundreds of thousands of lines of code, that are across multiple systems to get that in there. So, we just basically started in 2013, and running into all these brick walls to, we have extremely good model of how a subscription business works and then plugging Shopify into it was not like trivial.

It’s actually a major focus for us that we’re always trying to get better in that space, but nobody’s focusing on Shopify in the same way that we are. Shopify’s become our second integration. So number one is still Stripe unfortunately to everybody on this call, but then maybe we can all work together, to correct that and get Shopify. It, we have, I think had something like 10 integrations or something like that. And Shopify went from like number 10, up to number two. Not overnight, very quickly. So that, like we took a bet on Shopify. We thought that this was gonna be a big space for where subscription businesses were gonna be built.

And we were right. So the first office, just like nobody else is focused, focusing on Shopify partners like we are second is the kind of focus on getting to those insights that kind of helping you understand. So we have both from a product perspective and from a team perspective, we’re here to help you understand. We’ve had lots of SaaS 1 0 1 chats on the Shopify side. Just even help them understand what they’re looking at and understand how to like talk about their business and what the different levers are all the way. But then, of course, we take that too, okay how do you now use this information to grow your business?

And the third thing is then going into the future. So the flight path side, really no other tool does forward modeling. And definitely doesn’t do it to the point where you. FLA path can tell you once we, and obviously we do the same thing. We help you get that all set up in different scenarios. But, we can tell you, what your forecasted bank balance in June of 2027. It’s you’re not gonna get that out of another analytics tool. So those are the major things, doing all that with yeah, relatively few mouse clicks is what we’re looking to achieve to make sure that we’re providing a good value back to the customers and make sure that you feel like you have the foundation that you need to build a super strong business.

Yeah, no, this is lovely. Thanks. Thanks so much for sharing that. I just like to understand the value prop and stuff like that. So it’s very clear, flag in the sand and you really are helping and with some very unique, feature sets. I appreciate that. I wanna pivot to a story cause I think this will also, I think, motivate. People and saying, Hey, other SaaS founders have made the Baremetrics choice. And, hopefully, you can maybe share a case study or some kind of a story, around a partner, they implemented the solution. I just would like to undercover specifically, what motivated them maybe from their current kind of spreadsheet-y kind of hypothesis thing and then becoming a customer. And then what happened about, is there any efficiency improvements or like any extra revenue being generated for their app or platform? Just, hopefully, I don’t put you on the spot here, but it needs to be to maybe highlight one particular company.

Yeah, absolutely. So one customer that I have and we actually talked about it. We’re actually pretty public with our relationship with them is a company called union works. And they have three different, three different apps. One’s called happy birthday to send, discounted emails, on your birthday. It’s pretty useful. One’s called the grapevine. It’s attribution, marketing attribution, and then they also have one easy Google customer reviews, which you can, you could probably figure out what that one does. Yeah, exactly the company that I found it was called team password. It’s a password manager for team. So anytime I see something named, that’s like directly down the middle of the plate, like fastball down the center, I’m like, that’s my style right there.

So, yeah. and our relationship with them was similar to what I’ve been discussing around. They didn’t really have the data that they needed. And they were trying to figure out a lot of the ins and outs of their business and trying to glue data together. And they had the assumption that they were doing pretty well, but even that is something they couldn’t quite quantify how well are we doing and how are we doing against historical benchmarks and moving forward, so it was a perfect example of a group that was doing really well. They didn’t actually know how well they were doing, but we were able to help them show like, yeah, this is how well you’re doing. We definitely were able to be a good partner and fill them in on just all the industry standard stuff.

Again, like we just have all this institutional knowledge about how subscription businesses build and scale. So being able to provide a good amount of that and being able to deliver that to them so that they can run their business in all the awesome ways that all the awesome ways that, that we’ve been talking about so far.

It’s interesting. I know union works. I think Sam Hennings, I think I had him on the show a while back talking about happy birthday and yeah, I think that’s, I think that’s how we originally got aligned. It’s ourselves to believe you on this podcast.

Yeah, they’re like the centre point of Shopify partners. It’s really great to see one their own personal success, but they’ve really, it seems like they’ve made a mission. Also, be a connector and also help others, they feel like they have, and probably you two we all have this sort of picture of Hey, this is like a really great thing going on here. This is a really cool kind of emerging market, although quickly emerging, like you said like we’re up to 7,000 plus apps, so it’s not really a baby anymore, but yeah, it’s really cool. What they’ve been able to do as far as just bringing everybody together and making that like a side quest for them, aside from their own great success that they have.

What’s interesting too, is I know I subscribe. There’s a thing called that they’ve produced each week called SASI, SASI, a Shopify app store index. And I’ll put a link in the show notes for it if you’re a SaaS founder right now, and you want to understand, new apps are being released into the marketplace and just have a good summary, they are scraping or API connected to the partners. I don’t know what they’re doing, whatever they’re, there’s a daily email, but I get that thing. I get the weekly one just to roll up in the summary of what, and it gives me ideas even for this show and saying, are there any new partners out in the ecosystem that are doing some unique things or were they on another eCommerce platform and they’ve now made their way over to Shopify, maybe more a notable partner, or SaaS connection? Pretty neat for those that are listening today. If you’re in this SaaS world and you’re building on the Shopify partner ecosystem, getting connected and signing up for that free access to SASy would probably be a pretty smart choice.

Totally agree. We sponsor SASI as well. And we’re super familiar with it and oh, there you go. We love it. It’s awesome resource.

Very cool. So let’s talk about the future for Baremetrics, obviously, you said it’s seven or eight years old. Now the platform has been recently acquired, you’ve done other acquisitions from the flight path and others. And so just would like to understand, like you do a lot of great things today. You’re very clearly other than Stripe being your number one, connected, and partner, but no Shopify partners being number two now, just we’d like to understand where it’s headed for the, I guess the remain, remainder of 22, maybe end of the future. Is there any public roadmap or anything that you can talk about notably about where you believe the platform is headed?

Sure. Yeah, we don’t have really a public roadmap to speak of, but I guess this serves as that, where I get to pontificate a little bit and share some of the plans that, that we have. Again, obviously, Shopify is something that we wanna continue to go deeper and deeper on. There are just a number of things that are a little bit different in the Shopify world that all the time, we’re just building in and improving our integration and finding little things that are different.

Again, that’s like a big part of the issue, especially being multi-platform is to make sure that things are and things are joined up. So for example, we have customers that use multiple integrations. They have some of their subscription revenue comes from Stripe and some come from. Shopify or some comes from Shopify and some come from the app store. So there’s always work to be done there on the tactical side to make sure that all the data is aligned and cleaned in the same way so that we’re providing a nice, consistent experience there. Beyond that kind of forward. That’s like blocking and tackling type thing of in something we’ll probably be doing forever, especially as like APIs change and businesses change and more features could add it.

We’re always that’s part of what it means to be committed to a specific payment provider. You sign up to Hey, we’re just like always gonna be tweaking this, adding it, improving it, and then figuring. What needs to be rolled out retroactively and so on and so forth. So the next thing beyond that is something that we’re working on pretty heavily is like we’re bringing flight path more and more in-house right now it’s a separate product that’s supported through API connections back and forth.

So the first thing we did is just build like a Baremetrics data feed into flight path. We wanna look to one, get that integration deeper, but also just build that in of unfortunately it’s one of those things that just takes a while wherewith Baremetrics I can say Hey, we, somebody signed up, we processed their data. We said a couple of things. They went away. And the month later we can look at the ROI of that, the flight path that just naturally takes a little bit longer, where it’s gonna need to be over multiple months. And but what we really wanna do my next like kind of public milestone is where we can like a more complete story of not just signing up for Baremetrics and understanding the subs substation side, but also okay this is how we like planned our hiring. This is how we planned our expenses. This is how, and again, I don’t wanna, I’m pausing for a second. I don’t want people to be in this situation, but if they are, we wanna avoid it of I want to ideally I’d love to be like, Hey, like we were going to run out of money at our current, like at our current pace and where we’re going, how revenue was growing and then expense.

Outs, stripping revenue, growth, people being able to make operators being able to make really good decisions on like how to grow their business or maybe raising. That’s a great thing of Hey, if you have really strong metrics on the Baremetrics side you’re just small issue. You’re gonna run outta money. that’s a perfect situation to either raise debt funding or to raise, raise different venture funding or whatever angel funding, whatever the case is. So you know that’s the time to deploy against that. And then you can forecast your fundraising on top of that flight path.

So that’s the next cool, like major public milestone where I wanna have the full. Life cycle Shopify Baremetrics, flight path, and then like a business defining moment in the same way that flight path was there for Baremetrics. When we really needed somebody to have our back and help us understand and make the difficult decisions, like I wanna do that both through the deepening relationship on the Shopify side, on the Baremetrics side, but also including my path into that kind of the full business, 360 x-ray view.

Yeah, no, I love it. Thank you for sharing that. I know sometimes can be a sensitive topic sometimes talking about kinda where things are headed, but yeah it’s awesome that it’s very clear, you’re one of the market leaders doing this. And that’s the reason why I’m having on the show today. I just wanna make sure that these SaaS founders understand that there are ways of. Understanding your data, making decisions and forecasting correctly, and coming up with some creative ideas about how you can deal with churn and how you can enhance the LTV out of your existing customers. So I think all these are just really important topics. So thanks for sharing a lot of that., I know we chatted just before recording today, and I guess, I think you wanna talk about what the next steps for those listening today. Hey. Yes. I have an app in the app store. Yes. I want to grow further.

 And I think shop Buy’s been quite kind than giving SaaS founders, like first million dollars for free without having any revenue share. I think that’s pretty exciting. But where do you wanna send people today? As far as they’ve listened to this episode, they understand, yes. Maybe, I don’t know what, I don’t know. Where do you wanna send them? And then what sort of offer is available for those to kick the tires and see what the platform’s all about?

Yeah, absolutely. So yeah, if you’re feeling like. Resonating with this kind of description that we’ve given. Like we definitely would love for you to come over to Baremetrics, we have tri.baremetrics.com/fast lane. That’s a landing page that we’ve created specifically for this podcast. I’m sure it’ll be linked everywhere. We’d love to have you come through there. And if you sign up, we have a 14-day trial and we will get all of your data processed. And we chat with you. And we will have a person assigned to you to chat with you and help you understand what’s going on in your account.

 And I think like a perfect step is to just show up and connect your data and see what you learn. It might be the situation where, again, it, we’re all in the kind of spot to some degree of, we don’t know what we don’t know. So if you’re, but if you’re feeling like that’s why I talked to the emotions of it and the feeling of it, because this is exactly where I was. When I, that business I was talking about, I ran it for a couple of years and it wasn’t growing at the same rate that I wanted to was always growing. But slowly, and it, I tried all this stuff and it felt like nothing worked, and eventually I just, I wound up selling it and through crazy twists and turns of feet, that business is actually owned by the same private equity firm. That Baremetrics is so I know how well my business was doing. And it’s eight times bigger now than when I was running it, which so it’s oh, so it was possible to grow that business. I just didn’t have the insight that I needed. I wasn’t, obviously, if I took that business over now with the experience that I have now I’d be able to do better. So that’s basically, we’re trying to get people in if help them understand what’s going on with the business, then, what? How you can grow it, the how, and then really bring that all through. So I would take again if this is resonating at all show up, start a trial, connect, your, connect, your data. And even if you have zero intention to sign up for the product, I would hope that you would have at least 1% intention, but people are all over the place with that. And we don’t really discriminate on that point. You can just look at your data and we’ll walk through it with you. Maybe you realize this now’s not the right time for Baremetrics but you at least get that snapshot right now to know if you show back up in six months, you have that data to compare like in your head.

Okay. This was my MRI back then. This was my turn rate. If nothing else, I would say come and get your snapshot. And see how your business is doing and also grow us to see if we’re actually able to deliver it on being able to show you different options and slice and dice your data. Tell you something about your business that you didn’t already know. I would say put us and put us to the, to task on that.

Yeah, no, this is awesome. No, I really appreciate that. Cause I think that’s the key, the end of the day. You don’t know what you don’t know, I also believe that you just, if you attach it, ingest your data and come up with a couple of solutions and stuff like that at the end of the day, you really do want to grow your SaaS product.

And this is gonna get, and it’s so affordable. I’ve looked at your pricing model. It’s so affordable. The upside is definitely in the SaaS founder’s shoes than it in the Baremetrics side. And so knowing like just the forecasting side of it coming up with some creative ideas, getting someone to hold some hands at the beginning, just to understand your data, enjoy that free trial. I think that’s all. That’s great. That’s exactly what I was hoping you were gonna offer today for those listening. And, yeah. That’s it for, today’s that recording? I just wanted to thank you for coming on the show. I know that there have been some challenges with our calendars but I’m glad we’re able to make this work today. I just a parting note that I wanted to mention is that Shopify really is on a mission to make commerce better for everyone.

And is interesting. When I record this sort of podcast. I’d also add that you really are on a mission maybe even to help these SaaS founders really to help make data-driven decisions, I think to really help grow and scale their solutions. And I just appreciate that. That’s, you where you are headed and how your platform is really helping these SaaS founders. I really do appreciate that. I just wanna thank you for yeah getting on the show and sharing and just, yeah, just giving back to the ecosystem and I wish you tremendous success through this show and into the future.

Awesome. Steve, thanks so much for having me on.

All right. My pleasure. Have a great day.

Well, that’s it for today’s episode. I’d like to thank you personally, for being a loyal listener of eCommerce Fastlane. It’s my hope that this podcast is offering you a ton of value through growth strategies, tactics, and exclusive insider tips on the best Shopify apps and marketing platforms. All with my personal goal to help you build, manage, grow, and scale a successful and thriving company powered by Shopify. Thanks for investing some time today in listening to the show, I’m so proud and excited that you have a growth mindset and are a constant learner. I truly appreciate you and your entrepreneurial journey.

Enjoy the rest of the week and keep thriving with Shopify.

 

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