Carl: Hello and welcome to the SaaS growth podcast. This week we're here with Justin Duke, the founder of button down a simple and elegant tool for growing and managing your email newsletter. How are you today, Justin? 

Justin: I'm doing great, Carl. Thanks for having me. 

Carl: Thanks for coming on. So let's start at the very start. How I always start these interviews. How did you start button down and why did you create button down? 

Justin: Of course, I think depending on who you ask, my story of starting ButtonDown is either like a cliché or a cautionary tale. I did what many engineers do to some level of success or more often failure, which is they have a tool that they use, every day, every week, every month. They rely on it and they think to themselves, man, I bet I could build a better version of this in a weekend. 

I'm sure it can't be that complicated. For me, that tool was tiny letter, which was a sort of newsletter management tool back in the late aughts, early tens. I think it got purchased by MailChimp. At some point, they actually just sunset it last year, but it was clearly a product that hadn't been touched in literally a decade. 

But myself and a number of my friends and folks I followed online used it just as a way to keep in touch with people, do like very light broadcasting, like building up an audience without all of the heaviness and automation of some of the more powerful tools. And there were just like bugs like it wasn't any like philosophical sort of like grand ambition of I want to change the world of email, it was more, I have this tool that I find useful enough in the niche that I can't imagine like switching to any other tool, but it's also just bad I'm the kind of engineer that gets really frustrated when, I hit refresh and all of my writing that I spent 20 minutes on has been deleted or I hit the send button and like links are broken that shouldn't be broken things along those lines. And I really started building it from a place of, I didn't want to become an independent business. 

I didn't want to like, do anything really from a corporate perspective. I just wanted to create a tool that I would enjoy using more than what I was using at the time. 

Carl: Cool. So it was basically spawned out of a place of frustration, which I think is common for a lot of businesses. 

Justin: Frustration driven design is like not always a perfect tactic, but when it works, I think it works really well because. Especially for really large industries like email or marketing. If you're like finding yourself, like stubbing your toe in the same place or like having the same frustration, chances are the space is large enough that there's like thousands, tens of thousands of people running into the exact same issue and feeling the exact same way that you are. 

Carl: As you said though, email is a huge industry and there's so many of these tools out there. So how did you manage growing button down despite all these other competitors and tools? 

Justin: I think one of the advantages, especially coming at the industry from a place that wasn't necessarily like VC backed or like I had this huge war chest. I didn't need to figure out a path to become a billion dollar business. I just wanted to figure out a path to make it a sustainable SaaS. And when something is as big as email, where there's hundreds, if not thousands of like really healthy thriving competitors, there's a huge long tail of use cases. 

And there frankly, aren't a lot of network effects. The number of companies in this space have gone up over time, not down. Really what I found to be the most effective and was. To carve out a niche or carve out a lane and say this is what Buttondown is going to be really specifically good for. 

And starting out, it was for people like me who didn't care a lot about automation or drip campaign or e commerce stuff. They really just wanted like ease of use. They wanted to write in a markdown. I think one of the. Biggest single features that I sold on, even though it was like a relatively small part of the overall product surface area was just like button down is a newsletter tool that you can write and mark down for, and even today, like five years later, that's still like a really compelling sale to folks. 

Because saying you can write in Markdown is like a shibboleth, right? It really qualifies people who know what Markdown is and they're like, I want a tool that does that because I'm sick of using like MailChimp or Cloveo or whoever is like WYSIWYG. And folks who don't know what that is are probably not ButtonDown's ideal target customer. 

And so it cuts both ways. Along those lines similarly and this is not really revolutionary stuff. This is something that I think the 37 signals folks talk about a lot is selling on lack of feature set or selling on focus rather than breadth. And this is especially true in the email space where a lot of these tools over time, they just get more and more complicated, more and more bloating bloated because they're moving up market. 

They're trying to serve larger and larger companies. And being able to actually turn around the lack of feature parody and say we don't have those things. And that's an advantage because if you're our ideal customer, you don't care about those things. And it's good that we don't have them. That has and continues to be really effective. 

Carl: you've basically done the one thing I love telling people to do, which is find one group of people and just make them over the moon. So happy with your tool that, they become massive advocates and yeah. So the idea of make one group happy rather than a lot of groups look warm. 

Justin: Totally. 

Carl: Cool. So how'd you go about finding those initial customers when you were just starting out? 

Justin: The initial handful, and when I say handful, I mean the first couple dozen. We're all pretty much from, I think the combination of word of mouth and like I, I didn't at the time and I still don't have a particularly large audience in terms of social networks. I think when I first launched button down, probably had a couple of hundred Twitter followers and I had folks who I had just chatted about hey, I'm working on this tool and they used it because it was really hitting the same pinpoints as them. 

And then I did, the sort of cliche. Roundabout of launches. I think I launched on Hacker News and Producton and got like a handful of users and customers there. It wasn't like a gangbusters launch by any means, but it was like enough. It was enough that I had a handful of folks who were actively using the product, who sent feedback, who found it valuable enough to pay me every month. 

And so I knew there was some sort of validation, some sort of market there. And then the growth really came slowly and steadily after the fact, just like working really closely with those folks, seeing what worked with them, what they were stubbing their toes against, and continuing to refine the product slowly over time. 

Carl: So once you use those one off pushes and launches like product hunt, how do you, how'd you go about finding new customers and growing your user base, especially after you've honed the product a little more? 

Justin: For sure. One answer, which isn't necessarily generalizable, but I think is, Worth always keeping in mind that I don't think I fully appreciated at the time was the fact that button down being in the email space is like a slightly social product. Like we don't do any sort of like growth hacking or network effects deliberately, but if you're an author who signs up to button down, you bring over 20, 000 subscribers and you send your first email 20, 000 people at the bottom of that email, see a little tasteful trademark that says powered by button down. 

And in retrospect, that was by far like the strongest propellant of our growth, was just slow, steady word of mouth of one person joins, they send out an email, three of their subscribers end up switching from some other service and so on and so forth. I did a lot of the what I would call the machinery of marketing a SaaS that I think is a pretty common playbook at this point of I had a good number of, killer pages for long tail seo Have compete pages have feature pages publish a blog have a pretty active social network sort of series of accounts and all of those things were good I don't think any of them really turned the tide or accounted for all of growth, but they bolstered the growth that came from that social networking esque feedback loop. 

Carl: Nice. So you basically focused on your SEO and you sound like you followed pretty much best practice there. So you've got the free side there. And then also some social proof and almost word of mouth. So all those weren't necessarily pushing you directly, but the fact that they were using your tool and you would show them using your tool, you attribute that to those sort of growth paths. 

Nice. 

Justin: And I realized, I think over time to really lean into that of there's, I think pretty, I don't know if you want to call it a cliche, but like a piece of advice that you often hear is You should try 10 social channels or 10 marketing channels instead of keeping all 10 of them active. 

Find the one that works really well and then just put Drupal down on it. I did that to a certain extent with sort of the quasi social or word of mouth stuff to the extent that I realized oh, people care a lot about some sort of implicit or explicit endorsement and so where a lot of our blogging and evergreen content has come from lately is just I reach out to authors who have pretty large or sizable audiences who are clearly happy with button down, they're long term customers, they've paid, they've submitted reviews, they've been kind over email, and I say, Hey, do you want to do like a 30 minute case study, we'll hop on a call, you'll get editing rights, and we'll push that out. 

And that works really well in terms of it's evergreen, it's great for cross linking with feature pages. And it's something that's great. I don't mean this in a sort of like cynical way, but it's easy to churn out, like it's really easy to fill a content calendar with, Hey every week we're going to publish two case studies that are from two paying customers, got a huge backlog of content available as opposed to like throwing darts at maybe this blog topic will do really well against this keyword. 

If you, it feels a bit more genuine and a bit more. accurate as opposed to, and I'm not super well versed in a lot of the SEO stuff and a lot of the, I think, bleeding edge in terms of like programmatic plays and all of those things, but that feels much more experimental as opposed to here, there's a bit more of an established playbook where it's I know how I can run this, how I can teach another writer or content publisher to, to work on this. 

It's very repeatable in a way that I've, I appreciate. 

Carl: Have you seen many other businesses use button down to grow their own platforms and grow their own tools. 

Justin: Yeah, absolutely. I think one of the. More interesting parts of where button down sits relative to its competition is we're not super aggressive about protecting our network effects. So you can use it in what I like to call headless mode, which is a lot of companies will basically just run all of their. 

Broadcast sending on top of button down like we've negotiated an enterprise rate where they can remove that nice little watermark that gives me a lot of top of funnel because they're paying me a good amount and they're just using button down purely from like power based on their CMS. They might be a sort of large publication that has a couple dozen sort of newsletter verticals of like arts and culture, sports, etc. 

All of that on the backend is actually being sent out through button down and they're using a lot of. Our infrastructure in that way, I think on the other side of it, smaller companies that are more in the pre seed or series a stage where there's a lot of really powerful tooling there. 

That is like more suited towards a late stage SaaS. If you need the kinds of things that say like a HubSpot or Salesforce will offer you, or it's like CRM functionality, you've got a lot of drip and lifecycle enrichment that you can do. We like it. Button nouns are probably not the right tool for you, but if you're still trying to find product market fit, you've got some demos, you want to have a splash page out there and just collect email addresses so you can let folks know like broad strokes, hey here's what we're working on this month, here's what we've shipped button nouns are really good fit for that. 

And it's really fun there to see some of the inflection points for these more nascent companies of Oh, I can tell they just hit front page on Hacker News because they went from getting like a handful of subscribers a day to suddenly they just got 5, 000 and now they're like really working on things. 

And our pricing is pretty in line with that too of those folks are generally less willing to pay early on, but then as they grow and become more sophisticated, our expansion revenue grows with them. 

Carl: I saw a tweet from you the other day talking about how there's no, no such thing as free tiers, if that makes sense. I did notice that ButtonDown has a free tier, but what are your thoughts on free tiers, and how they fit into SaaS products, and, 

Justin: Of course. The way most tools in this space are priced are, they're metered on one of two things. It's either like number of contacts, like number of distinct email addresses you have. Or number of emails you literally send, which both reduced to the same thing, like how many subscribers are you emailing? 

Like we're going to meter based off of that. And when I first launched button known, I looked at the landscape of most of the other, like more mature, more sophisticated tools out there, MailChimp, ConvertKit, drip, et cetera. And all of them had a free tier of like. Somewhere between 500 and 2000 subscribers. 

That's the free tier than anything more than that. And you got to pay. And I was not like particularly clever. I was like I'm going to take what looks like the median of all of those numbers. That's going to be my free tier. So I launched with, Hey, if you've got less than a thousand subscribers, it's free, if you've got more than you have to start paying and as someone who is running button down for the first couple of years is like a nights and weekends business. 

It was very clear after a certain point that the single biggest source of where I was spending my time and my energy was on support and not even support for paid users, but support for folks who were say in the 500 to 800 subscriber range, like they had a non trivial audience. But they weren't paying and didn't necessarily have a high willingness to pay. 

And like when you're working 20 to 30 hours a week on a thing, you have to be so tactical with how you're spending your time. And after a certain point, I was like this is just not sustainable, but now it's growing to a point where customer service is going to be my full time job unless I change things. 

And I heavily curtailed that free tier. I shifted it from a thousand to a hundred. I took a lot of the like. Nicer features and moved them into the 9 a month tier. And so we still have a free tier, but when I talk about it with users, I basically call it a free trial of, if you have a tiny list, like you're just sending to friends and family, you can use us, you're not really going to get any support. 

You're not going to have any fancy tools. You have to pay at least a little bit a month to, to get to that point. And this was frankly, like a bit of a nerve wracking experience for me. I think. It's really easy to talk academically about, Oh, you should always experiment with pricing and you need to be as cutthroat as possible and capture all the value you can and all those things. 

But in practice it's tough, right? Like it's hard to imagine clicking the merge button and then suddenly having 40 percent of your user base who was once free be asked to pay. And we tried to roll it out slowly and all those things, but it can a little bit nerve wracking. 

And the response was great because Pretty much exactly what you want to happen in those kinds of circumstances happens, which is all the folks who actually find your service valuable are like, okay I'll upgrade it to the 9 a month thing. Totally get it. Totally understand all of the people who don't. 

churn onto a different service. And that's like a win of you probably were never going to pay. So this is a net win for me anyway. I think and I'll repeat what I think I mentioned in the essay there, which is the concept of free tier, should you have a free plan? 

Should you do free trial? All of those things. It's all like people assign such strong emotions to them. And really what I think you have to do as a business owner is be ROI oriented of what are the costs where cost is not just like database, but also your time, your ops budget, all of those things of maintaining this and what is the actual ROI you expect from having those folks? 

I still have a lot of. People who aren't paying for button down and I know a good number of them will convert at some point because they'll grow to the point where they have to start paying or they might turn off. But shifting from just following the rest of the market whose calculus is just much different than you being a new business owner or being a new founder and instead being deliberate and choosing what makes sense for me, like what are my parameters of success? 

I think that's the biggest thing I'd recommend to folks who are thinking about changing their pricing strategy. Exactly. 

Carl: It's definitely something I've heard a lot from people who have free tiers is that it does create a lot of support burden and for people who aren't paying so it becomes effectively a net loss for your customers. It becomes a sales cost but it can be quite expensive especially when you are limited on time. 

So I think it makes a lot of sense for you to have shrunk your free tier. I'm curious as to how exactly you went through that process of Because it's a one tenth of the size and how you communicated that to users and how you let them know that they'd have to start paying and manage that process. 

I'm curious as to the details of that. 

Justin: I tried to be frankly, really blunt with them. I'm sure you've received so many of these pricing update emails that don't even mention that they're a pricing update email until the last paragraph. It's like an update on our commitment to you as the user. And there's 10, 10 lines about how they've grown and changed as a company and all of these things. 

Like the broadcast I sent out to folks as part of the pricing change, laid it out like very concretely, where I was like I'm at the point where I can't service. All of these people who are free, like there are legitimate unit costs to sending emails and maintaining a service like button down. 

There's the implicit ones that we were just talking about. And I totally understand if you feel like particularly, betrayed or hurt, like it's annoying to set up a new ESP or a new provider and all of these things. And I think my timing for the rollout was fairly generous. I basically said you have until the end of the year, I think it was like seven or eight months. 

I will honor your free plan until then. Start of the new year, I'm going to start enforcing it. And again the really great users, the ones who I frankly love, they were just like, how do you switch me over now? Can I just start paying you the 9 a month? I totally get it. And of course I did get a bit of pushback. 

And that's, I think the cost of doing business, but the pushback was not large and magnanimous. It was largely like a handful of folks who were already problematic in some other dimension, like they had sent me, paragraphs and paragraphs of troubleshooting questions for something that was their problem or things along those lines, I tried to be as generous as possible, but no further than that, if that makes sense. 

Carl: I think you have some touch and I fear that a lot of people have when they redo their pricing is that you're worried you're going to start some kind of revolt in your user base. You'll lose everyone. But you're completely right. If people are happy to use it, Usually happy to pay and there's this weird correlation where the more money someone gives you, the less problems they cause. 

So 

Justin: 100%. 

Carl: yeah, so it makes a lot of sense. And certainly in my experiences of email marketing, I've grown a list of 100 people. And that's a hundred's enough to start with. And by the time you've got a hundred, you have, the value, the value offering and whether it's worth paying for. 

So that's, it makes a lot of sense for me. , is there anything that you feel you would have done differently in your journey of growing ButtonDown now that you've got this benefit of hindsight? 

Justin: 100%. It's a great question. I think one of the things that I should have done a better job of, and in a way I'm still paying down the debt of not being as deliberate or as sophisticated as I should have been, was being like really sophisticated with my topo funnel. And that comes through in a number of ways. 

One is just like attribution and being able to say this customer who just signed up for a 99 a month plan came from where, like, where did they first find out about me? Which specific lead page, which specific existing account, all of those things I had very little metrics or attribution around that stuff until pretty recently, and even now I'm still in the mode where it's like, Oh, there's so much more I should be trying to pull in. 

So I can. Better understand the behavior of my users, where they're coming from, what projects and what efforts are succeeding and so on and so forth. And, it's a bit of a balancing act there. Like you can definitely, and I've talked to a number of founders who've gone way overkill on all that stuff pre launch, like you do need to build a product and have it work and have it generate value before you invest in that, but as soon as you get to that point. 

I think you, you should start investing in where people are coming from, what cohorts they fall into all of those things, because you're going to need that information. And it's really hard to backdate a lot of it. Like some of my greatest users are the ones who signed up for paid plans back in like 2018, 2019 have only expanded revenue, have incredible lifetime values. 

And I have to send them surveys four years later to like better understand their specific use cases as because I just wasn't collecting or even thinking about collecting that data on the other side, but still top of funnel. And this is not going to be too self serving. I promise. But a lot of it is like the marketing automation of it all. 

I actually get angry emails from users who sign up for button downs, like official newsletter. And they're like, you run a newsletter service and I don't actually get any like educational emails from you. I don't actually get any like drip campaigns from you. I just get like a monthly send and maybe a couple of things, but that's it. 

Like you should probably do more here, which is a hundred percent true. It's one of those things that. Any sort of like investment in marketing compounds. And I think I failed to appreciate how useful that can be until really pretty recently until the past year or so, because I was so focused being like an engineer by nature, as opposed to a sales person or a marketer, I was so focused on. 

Iterating on the product and like making the product 1 percent better day after day. And I wish I had started doing that to the overall business and the overall like marketing architecture a couple of years earlier. 

Carl: I've asked that question a few times now, and it's interesting how everyone always comes down to sales and marketing is usually where they would have more effort. But it's come from an engineering background too, and it's comfortable working on the product, and it feels like progress, but really where the impact comes from is from those Those marketing channels and from those sales optimizations, which is uncomfortable and it's difficult. 

Especially cause it's just, it's so it's effort for, it takes a long time and a lot of effort over a long time to start seeing results. 

Justin: 100%. It's really tempting because, I've got engineer brain. The best task in the world for me is like a bug fix where it's here's a thing that's broken. I have the stack trace. I can write a test case. I can fix the test case. It's now done. Like I know the atom of work has been successfully completed and I get the little a serotonin boost from doing that. 

But like you say, things like marketing efforts, like there are. There are lead pages or pillar pages that I built two years ago that now are like huge swaths of traffic to button down. But at the time it was like literally one to two page views a day. And it's it was very hard for me then still hard for me now to internalize the long tail return on some of that stuff of I think people, I know I certainly did, have this like misconception of SEO being this very short term, tactical thing of you're going to change some stuff, and then you refresh Google seven days from now, and suddenly you're hockey stable. And the reality is, it's more you're setting yourself up to be 1 2 percent better 90 180 days from now, but again, you can compound and stack those things. 

Thanks, Andy. You need to just take the discipline it requires to do that, even if it doesn't feel particularly satisfying. 

Carl: so we're approaching the end of the interview soon. Is there any advice you have for other founders starting out in their business or starting to grow? 

Justin: I think, we talked a lot about the marketing and early stage onboarding folks side of things. But I think one part of this discussion that does get overlooked, almost like overcompensating, is like focusing on the product and like building something. Good. And I think a lot of the folks who I talk to who are maybe first starting out, first founding a thing, or first putting something on the internet that has like a Stripe page attached, right? 

They often feel a little despondent where they're like I launched this, like I got some users or some visitors, some big amount of traffic. I had one or two customers and that was it. And I spent two months building this thing. I guess it was a failure. There's nothing there. And often, the thing that you have to do is spend more and more time building. 

I think there were definitely times during Button Mountain's first year for me, where I was like, this thing has 300 MRR. There's a couple of people paying for it, but this is not like a serious business. Maybe I should just put it all away and have it sit in a closet somewhere and work on something else. 

Because again, as an engineer, doing something new is always more fun than working on an existing piece of whatever. But really where button down grew was slow, boring compounding over time, not just from a growth standpoint, but from a product and engineering standpoint of. Email tools, especially given how large and saturated the market is, they're complex. 

They require a lot of polish and attention to detail. And I think there's a lot of advice online that's if you're worrying about privacy pages or log out functionality, you've shipped too late. Like you got to ship quickly. You got to ship quickly. You got to ship quickly. 

You, you need to validate. And there, there's a bit of truth in that. But also there is so much supply in terms of software these days, more and more people are building more and more businesses that after a certain point, like there are things that are table stakes, you might have an otherwise great product that users are going to bounce off of because they're like, this thing is just janky, like nothing works, like I can't actually do the things that I'm trying to do, there might be like a kernel of useful value in here, but The overall experience is so bad that I'm not going to try and use it. 

And I would recommend to folks, if they're ever feeling like their product has some small level of traction or monetization, but it's not quite as large as what they hope, the answer might just be, you got to do more work. You got to keep building it and keep improving it so long as there is some kernel of folks who even despite all the jankiness, find it valuable. 

Carl: I think you've got an interesting point there about someone's paid for a product, right? I've got one or two people and maybe it's not the amount they hoped for. But the fact that someone cares means that there's probably more people like them and you've got to find them and serve, find out who they are and serve that audience. 

So totally agree. Sometimes you just got to stick with it a bit longer and let that long tail sort of start churning, stacking those bricks. Anyway, thank you for coming today. I've really enjoyed this conversation. So yeah, this is Justin Duke, the founder of ButtonDown. So you can find ButtonDown at buttondown.email. And I highly recommend it. It's a very powerful email marketing tool and focuses on simplicity and elegance and making your whole email marketing journey a lot easier. So again, thanks a lot for coming, Justin. We'll see you all 

Justin: so much for having me. 

Carl: See you next week.