SPEAKER_00
Yo, what up everyone? This is Joe Derrico, creator of Prompt Jockeys. We are back after a one week hiatus for my wedding festivities. In today's episode, we've got a recorded live stream from Cody Schneider, CEO of Draft Horse and Kobe Conrad, head of growth at Rupa Health.
Tons of great info on building audiences and scaling startups. Here we go.
SPEAKER_01
Awesome guys, welcome. Today I have on my good friend, Kobe Conrad. We've known each other for like 10 plus years.
Joe's up here as well, as he's gonna be helping with the admin side. So quick background on Kobe. Kobe has done things from spent, you know, millions of dollars a month to do more mortgage, like loan acquisition for large banks.
He went through Y Combinator for a company. And now he works as the head of growth at a startup called Rupa Health. That's where we last worked together.
So he has an insane amount of growth knowledge. We've known each other again for 10 plus years and over the years have just shared the arbitralages that we see and then capitalize on those. And yeah, that's basically kind of the context for why he's here today and why we're gonna have this conversation while it's gonna be valuable.
So to begin, Kobe, how did you get into growth? Man, I actually never asked you this or like never understood, like what, I mean, you were always selling stuff from my understanding, but like what really drew you to this thing?
SPEAKER_02
Oh man, that's a great question. I don't know how far back I need to go here. Like when I was four, me and my brother were selling lemonade in the middle of freaking nowhere, Idaho.
I think like, I think like it really started probably, honestly with like RuneScape gambling videos, like when I was like 17, I like was-
SPEAKER_01
You were in a casino, right? Like a RuneScape casino?
SPEAKER_02
Yeah, and I was like recording the videos and like throwing them up on YouTube. And then I do like drop parties and be like, hey, everybody needs to go follow me in order to, before like the drop party begins. Yeah, shout out to Lewis.
Red hat he had on the floor. But yeah, so I was posting a bunch of YouTube videos that was going super viral. Like that was like my first foray into like social media.
Was like, oh man, it's kind of fun. I started to like make the content and like the stuff sort of starting to go viral. Like that's kind of cool.
And then my girlfriend at the time was really upset that I went to college. So she had to into my account and delete all my videos. So that was upsetting.
But I think it was like what first got me interested in like the quote unquote marketing world.
SPEAKER_01
Awesome, man. Yeah, I know I love it. I think at one point you told me you were doing something with WoW too, right? Like World of Warcraft where you were basically creating guilds and like selling like the digital currencies for like PayPal or something.
SPEAKER_02
Yeah, I was doing that with both RuneScape and WoW. Yeah, cool.
SPEAKER_02
That's so funny. If like all of the web three stuff with like NFTs is kind of like... Did it feel similar? I just wish that they would have all of these video games would embrace like their digital stuff being worth real world money because that would have made them so much more interesting. Like they're still haven't been like a massive game like WoW or RuneScape at that level that like has embraced all the web three stuff.
And I am so excited for that to hit.
SPEAKER_01
Totally, totally. Sweet, okay. So fast forward.
When we met you were basically running Facebook pages and at the time you could get free traffic from Facebook. Talk to us about how you found that arbitrage and like what you were doing. I mean, you were like OG dropshipping.
This would have been back in 2012, 13, 14. We met or I think it was around 2014. So anyways, let it out for everybody with the kind of the things you were doing there and what you saw.
SPEAKER_02
Yeah, oh my God. That's hilarious. Okay, so back in 2011, I'm basically a grandpa now.
That's why I'm losing all my hair. Like I have strange shots. Like if that wasn't Facebook followers would get you like millions and reach every single month.
So I was just honestly smoking too much weed with my girlfriend and we had like this Facebook page for hippies and we were just like posting like memes and shit that we found from like Pinterest and Tumblr and crap. And we grew that to like 17,000 followers which like wasn't that much, but it was like 20, 30 million impressions a month. It was fucking wild.
So like, okay, cool. Like we can start a business with this. So we like throw up like a really shitty like blogger.
com template with like PayPal integrations. And we went to hippyshop.com. We basically just took all the images and like put them on our website and like marked them up 20%. And then whenever like someone would purchase it we would just go to their website and like place the order.
And they eventually got really mad at us for doing that. They're like, you can't steal our images. I'm like, you can't do this.
I'm like, making you guys like tens of thousands of dollars a month, like why are you guys getting upset at me? So anyways, I was like, fuck it, fine. I'll start my own hippie shop. It's gonna be better.
So we called it hippieshop shop, which is hippie shop with an E at the end. So we started SEOing that and we got it to ring like above their website, which was wild. And then yeah, we started just like importing product from like 30 different countries.
SPEAKER_01
You did that man. So just to reiterate that, some people hear this like they had hippieshop.com. And so Kobe bought hippieshop.com, which basically he could go after and start ranking for their brand name.
And so that's what he accomplished with that. Like through that domain acquisition, was he was outranking the company that he was competing against for their own brand name. I mean, that is just crazy.
So anyways, I just wanted to reiterate that because I always thought that was insane.
SPEAKER_02
Yeah, it was funny. It was fun, man. But yeah, we, so we went viral on Reddit and like this was back before I knew like Jack shit about like raising funds.
So we sold like 30% of our company, 25% of our company for like 30K, found some random person in Chicago that like wanted to invest and like bought a bunch of inventory and like put that into like Facebook ads and stuff. And then yeah, we built up like half a million Facebook followers between a couple Facebook pages. I mean, that was fun.
Like honestly, like I'm like super deep into like the VC backed tech world right now. And I like, I'd like make way more money, but I was like a 19 year old with a cute girlfriend that was just like smoking weed with me and like running a hippie shop, not having any bosses or anything. Like rent was like 700 bucks a month and like Boise, Idaho.
I don't know that. I don't think I appreciated how great life was for that like year period there.
SPEAKER_01
But yeah. So all that traffic evaporated, right? Just to set the scene. So you're making cash, it's printing.
You're doubling down on this whole distribution channel. And then overnight basically Facebook turns off traffic. So talk to us about that and what happened.
SPEAKER_02
Yeah. So Facebook didn't make money. And at first, so they started swapping up the algorithm and it was this like massive shift from organic to paid.
And yeah, so we were able to play the algorithm a little bit at first, but then the algorithm got better and it was like really hard to gamify it. And yeah, we went from like tens of thousands to like 500 a month from Facebook traffic and we're like, oh, this fucking sucks. And yet we tried some paid stuff, but honestly, like our product wasn't very good.
Like just retroactively looking back on it, like the product was shit. Like I was not like a developer or like good at making websites. So we moved on, looked for more profitable ventures.
We started a cleaning company with our girlfriend at the time, started a marketing agency with one of my best friends, grew both of those to be fairly large, one of the largest cleaning companies and marketing agencies in Idaho. And yeah, life goes on.
SPEAKER_01
Totally. Okay, so FastBord, you get hired to come in and work for, I believe it was a bank, right? And you were doing basically like mortgage leads is what I would describe it as. Can you talk about that or what's that look like?
SPEAKER_02
Yeah, so the marketing agency, we had two specialties. We had cannabis companies and we have finance, two things that apparently go well together. So we were basically like, because cannabis companies couldn't advertise, it's like alcohol, you can't run Facebook or Google ads.
We were facilitating like influencer marketing ad purchases. And then on the finance side, yeah, I don't, some random dude off of Kansas, I found as a client, like got me into the industry. And then yeah, we started just doing like a shit ton of lead gen for mortgage companies.
So like back in 2013, where like everyone in the mortgage industry was like 50, 60 years old, they had no idea. Oh, my hairs. Yeah, no idea how to do digital marketing.
So we started doing a bunch of Facebook and Google ads. And yeah, we're able to get like one loan officer to start like originating like million the month off of our traffic. That was fun agency work fucking sucks.
So eventually I just like found my best client and they wanted to bring me in house. So when in house did that with them for a little bit? And yeah, super fun.
SPEAKER_01
You spent like five million a month. Was that the number when you were there or was it a year? I can't remember what it was. Yeah, that was a different company.
SPEAKER_02
I don't know how upset they're gonna be if I say exactly how much. But we, yeah, we were originating like tens of millions if not like hundreds of millions, like total why were we there? And then the company where we're spending money on SEM was actually bold after that Cody. So eventually I put that move to San Francisco and then they were like a resume builder.
Yeah, that was tough and wild. They were spending like total, it was like $5 million a month. So they brought me on to like handle all of their international ads accounts.
Yeah, it was super fun. Unfortunately that only lasted like six weeks until my little brother was like, hey, could we I applied to my combinator and I put you down as my co-founder. And it was like, I should not go do that.
But yeah.
SPEAKER_01
I didn't know he did that, that's so funny. So Kobe's brother is like one of the, one of the early engineers at segment just for context for everybody. So he's just honestly just God tier, like a G.
So anyway, before we move on to that, I just wanted to kind of poke to, or kind of reiterate two things from that, what you shared. So specifically the idea that these arbitrage, like you couldn't do those same things now, like Facebook and Google ads. So like at the time, I just remember this like Facebook, you could basically just run any finance ad with like any targeting that you wanted basically.
It's like, cool, give me only rich zip codes and now serve ads there basically. I'm curious to thoughts, Kobe, on just like how you're thinking about like those experiences, like how you think about diversifying ad channels and like what's your kind of approach to that now that you've like, what do you carry with you from the learnings that you had with those previous companies?
SPEAKER_02
Man, that's a good question. Yeah, okay. So like the two lessons that like I have taken with me are first of all, make sure you're fucking diversified.
Like channels will like fundamentally channels change over time. Like stuff that's working today, like will change in some way like five to 10 years from now. So at the minimum, like make sure like you're working across like two to three channels and like running bets to figure out like how else you can push growth.
We see this a lot with TikTok, a bunch of people went all in on TikTok and like, oh, TikTok is gonna last forever. And then it started to get really hard to get reach on TikTok. Like it is just like the natural, there's a natural ebb and flow to channels.
And then the second half of that is product becomes super freaking important. Like my favorite example is looking at Calm. Calm is a unicorn because they have like their LTVs like a hundred to $200 where the competitors LTV is like $30.
Just fundamentally when your product is able to make more money per conversion than all of your competitors, it becomes so much easier to start bidding and becoming aggressive. And like my hippie shop, Shits, Morgan's products are fixed. So it's like an alter commodity.
So it's like, okay, cool. How do you create a competitive advantage?
SPEAKER_01
You're battling up that margin rather than thinking about the customer lifetime value or expanding that customer lifetime value, et cetera. It's just hard to do when you have shit product. So.
SPEAKER_02
Yeah. And this is why I've like landed in tech and why I think tech products are so cool is because you can increase your LTV over time, like a physical good, like you got to make it as good as you possibly can, but then it's like basically that that's your product. So like if however, whatever type of product you've got thinking in terms of like, how do I make this the absolute best I can and then continuously improve and iterate it over time.
Super important. More than I realized in my early days where I was just like trying to sling shit. I don't know.
SPEAKER_01
I mean, that's where we all start, right? And then you realize like, shit, I'm putting three years into this thing, but I can't sell it and that's where that pivot happens. So at least personally, that was kind of my, so we're all doing the same thing. I was like mining fucking e-commerce data and just reselling the best sellers of other companies.
And anyway, so, okay. So fast forward, you get into YC, you guys go and you build this company. Talk to me about that whole experience.
And actually this is a perfect segue into that of like the customer lifetime value and it's like what you're seeing there. So.
SPEAKER_02
Yeah. Oh man, what can I say about YC? Okay. Don't believe the Twitter hype you hear from people that didn't actually go through the program.
Like just for me, it was honestly a lottery ticket, but it was one of like the most important things that has happened to me.
SPEAKER_01
Was it network or what were those, what would like if you had three bullet points, what would it be?
SPEAKER_02
It was honestly brand, it was honestly brand.
SPEAKER_01
It just opens doors, like having that on your, like it's almost like resume type shit.
SPEAKER_02
Yeah. Like I was just this entrepreneur from Idaho, like people in Boise had heard of my cleaning company and market agency, but like I moved to SF and like fucking nobody has, like had heard of like the companies that I built before. So it gave like legitimacy to like actually be able to charge full price for like what I was doing in life.
And then check out their startup school, like YC startup school, you don't have to like go through YC to get access to that. They're really fucking smart. Like they basically accumulated all of like the right answers and put them in like consolidated resources.
So it like leveled up my product knowledge a lot. It taught me how to like pattern match with like VCs and just tech startups in general. Like that was super important.
The network is good. I should have invested more into it. My little brother did a much better job with that than I did.
I'm kind of anti-social. He like put me in a room and like all my energy goes away. But yeah, I would say like the actual education
SPEAKER_01
is crazy because you're a sales maniac just for context for everybody. Like I've watched this kid just do the most ridiculous shit sales wise. I don't know.
SPEAKER_02
It's a switch man. Like it drains me, you know?
SPEAKER_01
Yeah, I feel that.
SPEAKER_02
I can, there's a reason why I went into marketing like heavy marketing instead of heavy sales, you know? Just I, yeah.
SPEAKER_01
Totally, totally. All right, so talk to me about the company. So you build a company called Quark and it's making revenue.
But again, customer lifetime value is just shit in my understanding. What was that experience like? And like tell me some of the data just so people can get off on the fucking, like the growth porn you guys were seeing. It was ridiculous.
So you're spending a dollar and getting like 20 back, I believe, or something insane, right?
SPEAKER_02
It wasn't that crazy. So we had a 300% ROI. So that was driven through two things.
So like first, so okay, so back up half step. So Quark was open source cognitive behavioral therapy on your phone. So if you go to a therapist, most of them will use some form of CBT.
It's super, super effective. And my little brother was suffering from a panic and anxiety attacks. And he was like having, it was insanely affecting his life.
So he started like, but he made a little app for him to be able to do these therapy exercises on his phone. And yeah, we became the number one app for CBT on the iOS store. And then we were being able to run Apple search ads as a 300% ROI, which was just like absolutely wild.
There was just a very clear path on how to scale that to like a million dollars an hour. Problem was no one actually fucking used the app. It's kind of like people would go to the gym and but they'll sign up for membership but then they like won't actually go to the gym is people got really excited for this like mental health app and we had a really good conversion funnel and where no one else was like really betting on these keywords.
So arbitrage, but then they would like the retention after a month, like people who had actually came back and used it like 1%. So we were like faced with this dilemma of do we, do we keep going and like try to scale this even though people aren't actually using it or do we pivot and try to like build, like pick a new product that like people would like actually want to use.
SPEAKER_01
So you raised money for this right too. So you almost had one choice. Like you had to build a venture company rather than just a money printer.
SPEAKER_02
I gotta figure out how to answer this question correctly while being recorded. Yes, we raised venture capital which gives a certain expectation. We didn't raise very much.
So we have gone through YC and we took one check, maybe two checks, but I think we'd only raised like maybe 300, 400K. So it wasn't a ton of money. It was from a couple investors and like it was from a couple like post YC investors.
So it was actually really hard to raise funds for Quark. So like going back to pattern matching, like what do you have in the tech industry? Do you have all of these like tech founders that built their tech companies and then made a bunch of money and then they want to invest into like more of the similar tech companies that they built. So you got B2B tools and you got like DevTools.
There, like when we went through, there wasn't a ton of mental health unicorns. Like Calm was big and Headspace was big, but there wasn't like hundreds or thousands of like like these random S B2B tools or like DevTools and stuff. So it was actually really hard to pattern match and raise funds for that.
Also, I think some of like the best investors were smarter than us in the sense that like they asked about our engagement and they looked at it and they're like, oh, maybe there's not product market bit here even though it's like scaling. So it's probably like a little bit of that on both sides. So we did eventually pivot.
So we were like, okay, cool. We need about product that people actually use. So we decided to build a conflict free replicated data type as a service.
So for anyone who's ever used like Figma or WordDoc or anything where multiple people can like use that product at the same time, those are one of the best ways to do that is to do CRDTs or WebSockets, I believe. And basically that's a piece of software cost like millions of dollars to build. So we built that and then we made a generalized version of that so people could like build products on top of that.
And that was a really sexy product to investors. We, that was so much easier to go raise funds as, so we took that product. We got like a couple initial users and then we went and we raised like $2 million off of that.
But it was just an interesting lesson in like how easy it becomes if you're like pattern matching the correct thing of, we had a real product that hundreds of reviews that there was some usage and like it was growing really well. And it was super hard to raise money for that just because it was in the mental health space. But then we pivot to like a B2B DevTool where like we barely had a product and like no money coming in and like we were just selling the idea of that.
But like that was way easier to sell which was just wild to me.
SPEAKER_01
Totally. Okay. So fast forward. You're now at Rupa Health.
Just for context, I came on, I think it was like two months after you at Rupa and we did, we ended up in like six months taking it from like a $20 million valuation to $110 million. I remember you texted me at one point and you're like, dude, I turned on ads and this happened. So you were a founder, you went back and worked at the company, why did you do that? And like what drew you to that? And then what are some of those like growth? Like I think for a lot of people, they think about growth in an org and like what is growth? Like nobody actually knows what the fuck it does or like why it's important or why it's even valuable.
So I'd love for you to hit on that and then how you approach it and think about team and et cetera. So.
SPEAKER_02
Yeah. Okay. So I think there's two, two and a half questions. There's the questions you asked them.
And I think there's like, why did I stay too? Cause why I'm still here, I think is different than like why I joined. Really, it's like, okay. So starting from the start, why did I join? I love my little brother doing business with family, not always the best idea.
So like I was ready to go like do something else. And honestly, I just need a fricking job. Like I applied to a bunch of places, one of my best friends whose name is Ben was one of the co-founders of Rupa.
And he was like, co-league you should come help me grow my startup. And I was fucking terrified, man. Like the turnover rate for like marketing and growth roles was super high.
And they, they had. Especially for seed companies. Especially for seed companies with like unproven products.
And they had hired like someone before and like it didn't work out. So I was like stepping into this role where it's like, okay, cool. I have no channels that are working for us.
We've tried like Facebook and Google ads before and like that hasn't worked for us. Good luck and go grow the product. I was like, oh shit, okay.
Yeah, I liked my friend Ben and I liked the people at the company and they were giving me a paycheck, which is great. Thankfully, there was a bunch of stuff that worked really, really well for us. So like I stepped in the role and we started running Facebook ads and that we were like, that was scaling.
We started running Google ads and that was scaling. And yeah, like honestly, like what had happened was going back to you need a product that's really, really good is that they had spent, it's like a stereotypical story. Like we grew through like word of mouth and organic growth but they had spent probably a year and a half at that point just trying to build a really good product.
And the retention-
SPEAKER_01
Makes it easy to sell.
SPEAKER_02
Yeah. Yeah, the retention was great. People would use the product and they never turn.
They paid a lot of money for it and they loved it a lot, which meant they referred all their friends.
SPEAKER_01
I think an interesting piece too is that as they used the product, they expanded in revenue as a customer. This is like one of the things to think about in the business space is like, can I build a thing that when people use it, it makes more money for them? Which in turn, typically they use the product more. So their company grows, they grow with you, et cetera.
So just throwing that out there. Can you talk tactical stuff? Like, I mean, a lot of the times I'm trying, just to give context for the people that are in the discord, they're starting out just in this, they're trying to figure out like, how do I do SEO? How do I do any of this gross stuff? How do I do bulk, cold email, all of these things? Any of those pieces that are, the tactical kind of like learnings that were interesting.
SPEAKER_02
Yeah. So hard to show with that like screen sharing, but so like Facebook ads, like step one is go figure out your audiences, right? So like Rupa Health is a labs platform for doctors. It's the best place to order over 30 plus different lab, it's for different lab companies, whole account are one line is fucked today.
But like different types of doctors responded to it very differently. But now we fully understand that our niche is like this functional integrative space, but like you take it to like a conventional doctor who all they order is like quest, and it's like, why do they even need to do it? So with the Facebook ads, we started really heavily with like audience testing. And it's not like you can just target like license types on Facebook.
You have to like figure out their different like audiences. So it's like, cool. Do you like people of IFM perform different than people of AFRM that perform different than nurse practitioners that perform different than just like the category of health workers.
So we went in and we like tested, I was like 20, 30 different audiences, like figure out like what audiences would convert for us. And then once we found good audiences with just some like basic creative, then we like started testing creative and be like, cool. Let's test out, make a bunch of different ways to describe our product and a bunch of different images and a bunch of different videos until we found like stuff that like really started to turn for us.
And I mean, that's basically your playbook for almost any type of advertising, right? Is like, how to target your audience. Yeah, test the creative. And there will be different variations of how you do that, whether it's like Google or Facebook or Twitter or LinkedIn or whatever, but yeah.
SPEAKER_01
It's the same philosophy. I think the thing that gets magic is when you layer them all together, right? So like just for context, like he again, so I do like figure out Facebook and then you move on to Google and you figure out Google and then you move on to LinkedIn, you figure out LinkedIn and then you move on to cold email and you figure out cold email. And all of those things layered together is how you like create a company that can grow extremely quickly.
It's honestly, it gets crazy when you get all of them firing at the same time. It's kind of, it's a wild feeling to be a part of something like that when it's just like, it's too much growth too fast to be totally honest, but you're breaking the laws of physics. I wanna talk about some really two specific things that I think are really interesting that you did that I thought just for people here would be super, I think it would be valuable.
I wanna talk about owned media and monetizing it. So the podcast in particular and like any of the other things, selling courses like basically to educate your audience which makes them make you more money within the product which I again, I thought was super interesting. And then the other one wanted you to share what you're seeing work on YouTube right now cause I mean, you showed me some stuff two weeks ago and I was absolutely losing it.
Like basically figured out how to get YouTube channels to just like start proliferating itself like dramatically. So can we go through each of those?
SPEAKER_02
Yeah, cool. Okay, I'll start with like owned media and like how we got into that. Yeah. So owned media started with paid media. We began sponsoring a bunch of doctors.
So we sponsored Dr. Moore-Kyman. We sponsored a bunch of other podcasters and then every doctor has their own like publication for whatever type of doctor they are.
So there's like the Natterpath Magazine and the Chiropractor Magazine and the Integrative Medicine Magazine and like the GastroDI Magazine. So we started sponsoring like all of those organizations. And that was great.
It was driving users for us and just woke up one day and was like, wow, we spent a lot of money here. Wouldn't it be great if we like took some of this money and we like owned our own like media placements? It's kind of like a rent versus buy situation. Like you can pay these influencers and you're basically paying your rents but you could also like start building your own house and then one day other people will pay you instead of like the other way around.
So yeah, one of the most successful placements was with schools. So we would go to like the educational institutes that would like teach doctors about lab testing and we would sponsor them and that was effective. And then we're like, cool, we should like have our own courses and stuff.
So it started with live classes. So every week we would have a live class where someone would come in and we'd like give them like some masterclass over some technical topic and they freaking loved that. It was more just like super engaging.
It didn't actually turn into orders being placed. So our next step was-
SPEAKER_01
You had their attention. Like they were like these people that every, and I just want to talk about that audience. So that audience is like traditionally a very competitive audience to get in front of.
Like they have money and they're physicians and they can have purchasing decision power. And so a lot of the times it's just really hard to market to them and really expensive. And so this was a way to cheaply do that and build this trust over time.
Like if you're doing that on a weekly basis, giving that free education away, what that does is create this deep relationship with them. So anyway, it's just to piggyback off what you're saying.
SPEAKER_02
Yeah, 100%. And yeah, I think like after a year of that, it honestly took us a while before like we evolved in the next step. We started running boot camps, which you can kind of think of them almost like a mini like Lambda school, but for doctors.
So they're paid six week programs, doctors pay us like 300 to $400 for each one. Then we partner with a lab company to be able to provide a free test. And then we bring in like a world expert at whatever it is that we're teaching about.
And that's amazing for us because A, they are profitable. B, every sign up is a Rupa Health activation because you take your free test and you order a health, you order it on Rupa Health. And then you go through a six week program where you learn about that test.
And that was much more effective at getting doctors to actually activate and to actually like incorporate the testing into their practice. Yeah, that was huge cornerstone of our strategy to this day. That we're like trying to figure out how to like expand and taking the next level, which is really super fun.
SPEAKER_01
So just to reiterate, buying ads on other people's stuff, realize, hey, let's build our own thing because we know that the cost of all these ads are going to increase over time. So we build our own media so that we can put whatever we want on those rails as time goes on. They start giving away free education.
They start selling higher level education to that same audience that they've been giving away free education to. And that turns into a RevLine. And also it creates a better customer long term because they're going to spend more money because they got that education on the testing.
So just to synthesize that down. But sweet man, talk to me about YouTube. Like this is an incredible tactical thing.
Yeah, some context. I'm like, you know, you had a YouTube channel and this is a URUPA Health YouTube channel that had, you know, hundreds of videos that were on there already. And what did you do and what worked?
SPEAKER_02
Yeah, OK, so disclaimer, I'm not the best YouTuber in the world. This is just what I'm seeing in the universe currently. This is a really simple concept.
If you watch a video, you begin to see more videos just like that one specifically from that channel. I think a lot of people think of the YouTube channel as like trying to organically go viral in YouTube's algorithm, where it's like, cool, if I just make a video that has like a high enough engagement rate, like YouTube is just going to like naturally make my content go viral. And I think that's definitely true, is that like you create really great content and it will go viral.
But it's hard. And I think that the way that it figures that out, like the way it goes viral, it serves it to some people. Usually it's your subscribers.
And it's like, cool, do these people like the content? And then if those people like the content, it'll like branch out and it'll like share it to more. The way you get like that initial layer, though, is people need to watch your content. So there has to be like this top of funnel that YouTube can start serving your content out into.
And if you don't have that top of funnel, YouTube doesn't know like what the fuck to do with your content. So I have two channels, right, Cody? I have the Rupa Health channel. And then I just have my channel that I'm just like fucking around with with like 40 subs.
And it's really just.
SPEAKER_01
Every gross person, it's like fuck with your own shit. So if you fuck it up, you don't fuck it up for the person that you're working for.
SPEAKER_02
Yeah. It's a sandbox. So taking like my channel, it's like literally at zero.
If you if I look at where it's showing my content, it's not actually matched with the content of my channel. So what that's telling me is that starting at like zero is YouTube doesn't know where to put my content. Like it's it's like trying to figure it out by like putting in all like random places.
But like it literally doesn't know. But the but the Rupa Health channel, it does know like like it'll match up G.I.Map video with like H.Pylori and H.
Pylori videos with H.Pylori. And cool, we do we do an episode on like vitamin E and it'll start matching that to other vitamin E videos. Anyways, I think that the way that you you train the algorithm is you build up your top of funnel that's.
SPEAKER_01
Um, to get people introduced to your YouTube channel. Yeah, because the more people you get introduced, the more we're going to see those videos because it's going to start serving those when they come back to the platform the next time, etc. Yeah.
SPEAKER_02
And what what we're seeing is that.
SPEAKER_01
Our videos will like you straight just turned on ads to right? Just for context for everybody.
SPEAKER_02
So at one point, yeah. So we we we we turned on ads and like for I think like a month. And it drove like a couple hundred thousand views.
And what we saw after that was some of our videos started to like take up organically. Um, and I'm not the ones you were promoting.
SPEAKER_01
It was other ones that were on your channel.
SPEAKER_02
Yeah. And I'm like 100% confident what happened was we we had built up a large enough like top of funnel that like YouTube algorithm was like finally starting to crank and understand like who is supposed to watch our videos. Um, and then we you can like see is like to do and then and like some of them just like are starting to like pick up and they're getting more views than some of our like top articles are, which is crazy.
SPEAKER_01
And you can relate that back to it's like I turned ads on the graph is like this ad start here and it goes like this across like multiple videos that are not the videos that are being promoted. They're just on the channel separate from the promoted. Exactly.
SPEAKER_02
So if I like what I will the way we think about it now, is yeah, pretty good content, figure out how to make your videos as good as possible. Um, but also like how do you drive external views to build your top of funnel? Um, because you can't like you can't just expect YouTube to just like, especially when you're small, you just can't expect it to like pick it up and know, know where to put it that you have to like drive like a couple thousand views before like YouTube like understands like, okay, where, where am I going to put this? Um, and yeah, so we, you like, if you want to see someone that does it really fricking low, uh, check out Webflow University. Like they, they have this beautiful, uh, product that gets really great search traffic and it's all like fluently combined with videos.
So you, you go to it and you like look out how to do something in like Webflow and then there's like a video explaining it. Um, so now that's external traffic driving videos. Two their videos.
Um, and then the videos are also ranking within YouTube search algorithm or, and they're just like a recommended video algorithm. Um, so they're using the website to get those external views, which then
SPEAKER_01
allows the channel to get natural organic distribution to happen on YouTube itself. Yeah. So the, so good. I don't know.
SPEAKER_02
I don't know which is the chicken and which is the egg, but I think that strategy is beautiful and it's what we're trying to do. I mean, the graph speaks for itself, man.
SPEAKER_01
Like I saw it when you showed me like two weeks ago, I, I, I couldn't, I could not believe it. And just like for, again, to get deeper on the tactical side, like you were bidding on a keyword related to the video that you were promoting. And the video imagine is like, you know, 50 minute long live course.
And you're showing that 50 minute long live course to that search that people are doing that related search. So literally even realize it's an ad, they're watching this video and getting introduced to your YouTube channel through that. And like, like consuming it basically, which then allows, they're going to start serving more of the related content from your channel, like to those people that watch that.
Cause what, yeah, cause what happens if you watch a video, you see more
SPEAKER_02
content like that. So, um, if you watch the ad video on the right hand side is all of our organic videos, like, and then you, I guess, you're gonna be like, like, and then you like click on that. And like, like you, you get put into the algorithm, like, it's not just subscribers that see your posts.
It's anyone that has like watched your content before. So you, you can think of like who, who is going to see your content, not just as like the people that are subbed to your channel, but if you can just get them to watch your video, then they will go, then they will see more of your content. So your, your top of funnel, like who, who does your content go out to is anyone who's like basically ever, ever seen your content before.
So if, if you can get that to be like a couple hundred thousand, then you have like this big top of funnel that YouTube will use to start like testing your contents. And then like, as you're publishing stuff, it'll show it to the people who've seen your stuff before, um, who are likely like have demographic markers attached to them that like YouTube understands is a cool. Okay. Now I created content. I show it to some people.
Um, it performs well. Cool. Let's show it to more people within this like niche or category. Um, yeah.
SPEAKER_01
So you're almost speeding up what's naturally happening. Like if you just let your channel go on in perpetuity, it's going to do that. It's going to try to find like YouTube is going to try to figure out where do I place this content if it's good content.
But if you let your ad spend over the top of it, what's actually occurring is you're like taking that timeline and you're shrinking it down so that it's like faster, it's figuring out faster who it should serve it to. And then it's like, there's this tipping point that happened where it's like, okay, now cool, we know who to serve it to all their content that they publish. We're going to serve it to these people.
SPEAKER_02
Yeah, exactly. Like, um, because that's how we like discovered this sort of super
SPEAKER_01
interesting, man. Fuck, that makes me want to do YouTube shit.
SPEAKER_02
So much fun. Yeah. No, we, we posted a video and like a year and a half later, like picked up out of nowhere. Yeah, just pops off.
SPEAKER_02
It drove me insane, man. I was like, why, why did the content didn't change? The thumbnail didn't change. The title didn't change.
I had been ignoring this thing. So why did it take like fucking 400 days before YouTube's algorithm was like, oh, hey, this is a good piece of content. And like it belongs right here and people should watch this thing.
Um, so now our, our goal and like what we're trying to figure out is, okay, cool, A, how do we make our content better? But also, um, how do we drive our top of formal? And so I think some of it can be ads. I think some of it needs to be, uh, layer, like creating a consolidated content strategy. So like how to like hide this into like a draft course, right? Is, um, we, we think of SEO content in, uh, like topic categories.
So a topic category for us can be like cardiovascular health, right? Um, so we were thinking like, okay, cool. What video content do we have about cardiovascular health? And how do we tie that in with our website and how do we tie that in with all of our SEO content? So now all of these search terms, people read an article, they watch it, watch a video, and we like, we, we have like a consolidated content strategy where video and article content like overlaps each other.
SPEAKER_01
Interesting. Is it like one to one? Or is it just like, oh, this is in like similar categories. Like again, cardiovascular, we have like a high level cardiovascular video, but that's on, you know, 20 different blog posts or are you making individual videos for each of those blog posts?
SPEAKER_02
Yeah. Um, so we have way more written content than we do video content. So it's way easier and like, and we don't use draft force, uh, just because, uh, our current content strategies, like to create an end of one content that like hasn't been made before.
So we bring in like doctors to come and create that content.
SPEAKER_01
Yeah. They're doing like, um, it's for context, they're doing like case studies type of stuff where it's like, here's my personal data that, or, you know, whatever my client's data that I'm sharing.
SPEAKER_02
So yeah. If I was using draft force, like what I would do is like for every video I would go and I'd create like a hundred articles around it. Right. So like if I'm doing a video on like brands marketing for startups, I would go create like a hundred articles around brand marketing for startups. And then I put that video at the, like the bottom of all that.
Right. And then you have this like external funnel was driving views to your video, um, through like Google search. And then you have, uh, the video that starts like getting traffic and people watching it and YouTube understands like where this goes and like belongs in.
And then it will start like ranking within like the YouTube algorithm as well. Amazing.
SPEAKER_01
Amazing. Cool. So we just hit that 45 mark. Um, any arbitrage like high, you know, you can just rapid fire, like our marketing arbitrage are seeing right now that you're just excited about besides the YouTube, you got like two other ones for us.
SPEAKER_02
Oh man, um, this is really dumb, but like all the physical stuff is becoming cool again, like, like direct mail. Yeah. Like it's wild. Um, and I think what's happening there is that the same tech that made digital ads good of like being able to target your audience really well is starting to become relevant with physical stuff.
So there's, I think there's like arbitrage. I think there's like arbitrage and direct mail. I think there's arbitrage and like physical publications.
Like if you saw what Mercury did with their magazine, uh, radian, like that, that was really cool and has been like staying in the sector for them. Um, like even conferences and stuff have been really good. I've like, I like woken up and like, who am I? I'm like doing all this like physical marketing.
But like it's like the coolest part is like, you're not really competing with savvy marketers, uh, no offense to anybody who might be doing this. But the general general, like most of the audience is people that are from like the seventies and the eighties. You, you have these like old school marketers who are like, oh, I've been doing direct mail for like 30 years.
Um, and like that is like the primary competition there. It's, it's not like the new age, uh, air, like school of marketers who have like gotten into that industry yet, which just means there's like the designs aren't as good and like the targeting isn't as good. And there's just like a lot of arbitrage to, uh, bring like a, a tier marketing into a lot of the physical stuff.
SPEAKER_01
Direct mail. What are you seeing work like, like postcards, like, you know, what, like, what type of like creative is, are you sending out?
SPEAKER_02
Do you have like, uh, it depends. Like what you should do is if like go create a database of your audience and, um, segment your database, be like, these are my top thousand best people. These are the next 10,000 best.
These are next hundred thousand best. These are the next million best. And then create like different levels of, uh, mailers for each one.
So like your top thousand, like send them a fucking like gift basket with champagne and your, your next like 10,000, you can like send them like a little tiny package box that like actually have to open because they're not going to just throw away a package that gets sent to them. And then for like your next like hundred thousand, you can send them like a, like a flyer with like a discount code or something. Um, yeah, I don't know.
That's been cool. Uh, there's also just like really interesting things with like AI and the gen of like using, using AI to like qualify leads, uh, has been an area of arbitrage of like, how do you figure out who, who, who to actually target is you can now go to their websites, like have AI, like look over it and be like, cool. This person is actually in my audience.
Um, and that has like allowed you to be able to both with digital ads, also physical ads and also sales to target people way freaking better.
SPEAKER_01
Amazing. Amazing. Sweet. All right. Thank you, Kobe.
Uh, we'll open it up to questions now. If you guys want to come up, uh, just raise your hand and all and mute you. And we can, uh, start rapid firing.
So. And if there's no one, I'm going to ask questions because I have questions.
SPEAKER_02
I'm good either way. I got food after this. I'm really excited for sweet.
SPEAKER_01
Um, yeah, it looks like nobody does at the moment. So what I'll, what I want to ask, um, you're doing this content using off shore teams, um, like specifically like using animate animators, et cetera. Can you talk about that a little bit? Like how are you getting those people? How much are you paying? Like how are you finding them? Um, what does that look like and why are you doing it?
SPEAKER_02
Yeah. Uh, I can't say too much that will get me in trouble, but what I'll say is that there's really excellent animators like in like, uh, like the Philippines and India and just like going up work or like some third party, uh, job boards, um, and then yeah, having a really good video editor, I'll change your life. Like honestly, like they, they're super cheap and they're super good.
And they will bring your video quality into like the top 10% like super, super fast. Uh, you probably don't need to spend more than like a thousand to $2,000 a month to have one like full time. And if you only got a couple of videos to edit, you can probably find one that can like, like, like, like Cody, the interview I did with you that cost me 20 bucks.
It was like 20 bucks to edit up. It's insane.
SPEAKER_01
You can just build media companies now for nothing, which is just the most ridiculous shit. It's wild. Cool. All right. Uh, manual is a question.
Last gun mute.
SPEAKER_03
Hey, can you guys hear me? Yeah. I'm kidding. Awesome.
This is, uh, she's been interesting to listen to us. So like, uh, I feel like I should have paid for this, but my question, my question is, uh, for you, Kobe, I joined a little late. And so I heard you talking about sort of the pivot that your company had to make from thinking you guys had the right idea, thinking you had the right audience.
Um, from what I understood, you were making money, but then it wasn't really there and you guys made a pivot and things kind of skyrocketed from that experience. How do I, how do I word this? I don't want to do the whole, what advice would you give for someone, but for yourself, if you were going to go take this again and run, run the same play again, what things would you do differently? How would you spot the opportunities? How would you spot the right market? How would you go about finding the right market fit? That way you don't have to do that pivot again. You can just, uh, want to done it.
Does that make sense? Yeah.
SPEAKER_02
Oh man. Okay. Um, I'm going to give you like the answer of like what I would do again, but I, this is super specific. Um, the best general advice that I've had, that I've heard and gotten about pivoting is that it's called a pivot, not a hop.
And what I mean by that is you're sort of, you're supposed to have like one foot on the ground. Um, so either what that means is that you have a product and you have like users, you're targeting, you either move the product, uh, but still target the same users or you keep the product and then you move the users that that like product is targeting. But if you go product, new product plus new users, um, you're not pivoting your hopping, uh, which for us worked in that sort of work, not specific scenario, but I would have done it differently to actually answer your question.
Um, I launched another product later. Um, so when me and my mother, uh, were building the CRDT as a service, I'm not a software engineer. It took me a while to learn how to properly say a conflict of pre-replicated data type as a service.
Um, so like I went through like a programming bootcamp to like actually learn how to code and, um, I, I built another product called sunflower, which was, um, quirk. It was basically a clone of quirk is, is CBT, um, on your phone, but it was CBT for addiction. So by pivoting on the product to target people that were focused on addiction instead of just general anxiety, um, the, the number of people who were actually using it after a month went from 1% to 20%.
Um, so we, I think the right, the right answer for quirk would have actually been to, uh, niche down a little bit and find, find a, find someone within this huge thing of mental health and like anxiety to like, cool, trying to lose weight or like trying, trying to, uh, like stay sober or like pick, pick something a little bit more specific because once we did that, uh, the reason why it worked is like we were able, I was able to add in features for that specific user that would like keep them coming back into the app. Um, yeah, I, I think I would have pivoted by keeping the product and then pivoting the user rather than doing like a complete jump. Okay.
SPEAKER_03
And then I have a follow-up to, uh, to what you just said right now. Um, shit, just to escape you. Um, fuck.
SPEAKER_03
Um, hold up, uh, clones. Morning. So I've often heard that obviously if, if, uh, if you come up with an idea and you don't have any competitors, it's probably a sign that's probably not the best idea.
Um, you just mentioned that there was a company quirk, you decided to sort of take their same concept, tailor it a little bit. Um, I know that for the most part, it seems like the vertical you want to stand as medicine, how would you go about figuring out, uh, which, which companies or which products would make sense being a competitor, right? Like, I don't know if it makes sense for me to create the next, uh, Facebook, you know, on the next Twitter, uh, how would you go about finding where those opportunities are to make a clone and, and then to find that one thing to tweak.
SPEAKER_02
Hmm. Okay. This is a good question. Um, trying to figure out the best way to frameless.
I'll give you, I'll give you, I'll give you my advice, but honestly, Cody's probably the right person to ask about this. Okay. My. I think that most ideas are really dumb. Um, like most ideas, like my, my, my experience of starting with my shitty little hippie shop and then pivoting into like a service business with my agency and my, my clean company and then moving into like, uh, working for the bank.
With a fixed product towards, um, like going through Y Combinator and like trying to ideate stuff and like figure out new stuff. Um, I was very, very bad. I had no product knowledge.
Like I, I, I was this marketer from Idaho. Like I didn't even know that a product manager was like a real, a real thing. Um, and then like, how did you get into that? Like a real, a real thing, um, and then like coming into, coming into Rupa and learning what like a, like real product market fit looked like.
Um, there's my, my, my taste in my bar is now wildly high.
SPEAKER_01
Um, you also sell more pitches though. I just, I'm going to jump in because I just think that like that whole process that you just described, like there was a ton of business touches that happened there. And so like every time you make a business, like, even if it's small to start with, like that knowledge compounds into the next one.
And you just get better at looking at businesses and being like, oh, that's a good business. It's like, but you like, again, when you're starting out in the beginning, you're like, I don't know what the fuck a good business is. But then as you touch more and more businesses, you, and you kind of climb that ladder, it's like, you can hear a business model and you're like, fuck, that's a great business.
Like just how they're describing it and talking about it. So.
SPEAKER_02
So I think whatever you do, you have to gain unique insights. So Rupa didn't start off as Rupa. Rupa started off as, um, kind of like yell for doctors.
And they're like, oh, we're in this industry. And this goes back to why you pivot around your user, around your product is you, because it, your first thing gives you insights. You, they were like, okay, we're going to try to build like yell for doctors.
Like this is a horrible business model. Like all, all the good doctors already had patients. Um, the patients like didn't want to like pay cash prices for this stuff.
Like it just like wasn't working. Um, but then they're like, cool, we realize it's industry, but like talking to these doctors, we learned how these doctors are having such a hard time ordering their labs. So like, let's make sass for them to like be able to order their labs.
So they pivoted, they pivoted around their user, which was the doctors. Um, so I, I think there's kind of two models is you can either work for a company and develop unique insights. Like I, I, if I was going to try to compete with Rupa, like I, I have a number of ideas I'm very confident would be like really great businesses, like within, within the space.
And I have only been able to like gain that insight because I've been working in the space for a while. Like I, I, I know the things that Rupa is thinking through. I know the things our competitors are thinking through.
I know like where the holes in the market are of like, cool, someone could come compete here.
SPEAKER_01
Um, and you're getting paid to learn all that as well. Like that, I think people shit on jobs all the time, but like, if you get into the right one, especially in early companies, you can get so much insight into a market and you're getting paid to learn that insight. Like you couldn't pay anybody to give you any of that insight, but you're actually getting paid to do that.
So anyway, just to interject, but.
SPEAKER_02
And then, uh, the, the second model is like kind of what Cody did, right? Is like, he just picked something. He's like, I'm going to make, and like he started with like this podcasting tool, right? Like I'm going to use AI and I'm going to be able to work on, well, make that a podcast transcripts, uh, like, uh, like turn, turn the podcast into like an article, right? Um, that's like kind of, it's kind of a good business, you know, like, like people were paying for that, but like that, like the, I don't think the product market fit for Cody was like 100% there. Like it was growing, but he learned.
He's like, Oh, this is kind of cool. I got, I got like, we can, we can make AI articles. And then he like pivoted that into like draft horse, which then the market went from cool people who have podcasts to fucking people who are making articles and like the market for that's so much bigger.
SPEAKER_01
We wouldn't have landed on that unless we did that first thing, right? And then like by doing that first thing, so I just talked to this company yesterday and it literally was the same thing. They built this huge, massive product. It's absolutely bloated.
They hate doing it. The customer service sucks. And then they had somebody ask for just an aspect, a product feature of that product.
They pulled that out and it's now growing at like 500 MRR a day. Like it's just ridiculous, right? They're just cold emailing people that are in their target audience. And I, they wouldn't have gotten there unless they just moved around.
And I think that's something just like, there's a lot to be said about just doing things like we'll get you a perspective on the market that you just didn't have previously. Like by changing that move, like going to other places and looking around, like you're going to get, you're going to just see insights through that. Unfortunately, I have to jump and go to a sales call.
Joe, I'm going to make you the host. Kobe, I, you can jump as well. If you have something to do, I know we blocked your time for this and we've taken up a lot of it.
So I appreciate it and sorry, Super that we didn't get to your, your, your hand. I apologize on that, but thank you guys for coming. I really appreciate it.
SPEAKER_02
I'm so sorry, but if any other questions for free, some of your messages, Kobe at root for health.com or at Kobe, Jake Conrad at Twitter.
SPEAKER_01
Thank you, Kobe. Appreciate it, bro. Appreciate it guys.
Thank you. Thank you.