Nan Wang
Questions
- Gumroad charges a transaction-based fee, which would presumably be more expensive for higher-earning creators to sell on Gumroad. Why would a six or seven-figure creator remain on Gumroad?
- Across the lifecycle of a creator from listing their first product to making six figures a year, what are some of the biggest friction points on the user journey?
- In terms of their tools, one feedback I heard is because Gumroad doesn’t have full-time employees, the developers would probably work less hours a week than a developer somewhere else. This may create some product gaps over time. What’s your experience with this?
- How important do you think the marketplace is for Gumroad’s business?
- In terms of the marketplace, what does Gumroad do to drive incremental demand for the creators in addition to list your products on the marketplace and charge 10% on the transaction?
- Since the marketplace is product oriented and say maybe one stock market course is listed against 10 other stock market courses, do you think the customers could just price compare different products without having any knowledge on the creators themselves? What do you think about these price competition dynamics by listing products against themselves?
- Do you think because Gumroad has a marketplace feature, creators would choose Gumroad based on that?
- The flow of traffic is super important. The big social networks are like the top of the funnel, the upstream traffic for creators to build an audience. And then the creators want to redirect their audience into a more direct channel to cultivate their connection and monetize that way. What are some of the frictions in this process?
- There are some signs that Gumroad wants to open source their tech stack gradually, and there's a way of operating if they commoditize infrastructure and make the community the real value differentiator. How do you see the future of the platform being more of a commodity and the community brings most of the value?
- For these community features, there are also companies like Circle or Mighty Networks. Do you think creators will use different tools and stitch them together or do you see, there will be a one-stop shop of a very integrated platform, which provides all functions? For example, Kajabi is moving towards that direction with their community feature.
- If you recommend one platform to an average creator, which one would that be and why?
- How is Gumroad’s customer support? Especially in helping beginner creators to gain this upward mobility, to understand distribution, pricing and how to find an audience?
- What do you think about products like Linktree?
- How do you optimize your time across different platforms?
- Is there anything that you think is important for Gumroad and the wider creator economy that we haven't talked about?
Interview
Gumroad charges a transaction-based fee, which would presumably be more expensive for higher-earning creators to sell on Gumroad. Why would a six or seven-figure creator remain on Gumroad?
Guest: I think it's simplicity. I think it's the ease of use. For me, there are a lot of tools on the market and most of the tools cost thousands of dollars a year, whereas Gumroad for me is a $10 a month subscription. And then the tools that I use that are more expensive also end up charging a transaction fee, usually through Stripe.
I find that Gumroad provides a good amount of tools for a very good price with minimal breakage or any problems with the service.
Across the lifecycle of a creator from listing their first product to making six figures a year, what are some of the biggest friction points on the user journey?
Guest: I would say maybe some of the bigger friction points are just being able to collect enough social proof. I think that social proof is really important.
I think that takes time and is not perfectly ironed out on almost any platform, whether it's Shopify or Gumroad or Kajabi ... So I think that's a major point of friction
The only way to get social proof on Gumroad is to just ask people to leave a review or create a workflow, that allows people to leave a review, but there's no comments in the review. It's just star ratings. So it's harder to maybe get social proof than it might be on a place like Shopify, which has a bunch of plugins designed specifically to acquire more testimonials.
I guess the good news is, my testimonials still trickle in overtime and grow. I would love to see a more robust feature set around testimonials.
I think, um, another potential point of friction is trying to understand how to best impact your audience. Tools like Gumroad, you don't necessarily have some of the email functionality that other more expensive, robust tools have, but to me again, it's value in simplicity.
I believe that for the price and for the value that they provide, it's just been my go-to choice.
I think one other thing that I think about during the journey from your first dollar first course into making six figures is being with a team. That tends to grow and change. And one thing that I like about Gumroad is that I trust their team. I think they're always making continuous improvements. I feel the same way about the team over at Kajabi, which is another popular creator software, but there is other software that I don't feel like are growing or changing very much, but I feel in good hands and with Gumroad.
In terms of their tools, one feedback I heard is because Gumroad doesn’t have full-time employees, the developers would probably work less hours a week than a developer somewhere else. This may create some product gaps over time. What’s your experience with this?
Guest: I don't share the same concern. I feel like the folks that are working there are forward-thinking. I spend a lot of time on social media platforms like Twitter, and so they have a very, visible CEO. They have a very visible software engineer. I trust that they make good decisions in the minimal amount of time.
There are two things I like about it. It feels very indie. It feels small, unique and personal. I liked that about the service. And then the other thing that I like about it is, they also have a marketplace feature, where I've made over $2,000 in sales just by other buyers finding my course in their featured marketplace.
I don't see that with some of the other softwares on the market today. And so that's a nice extra bonus that does cover the transaction fees more than enough.
How important do you think the marketplace is for Gumroad’s business?
Guest: I could only guess that it's not extraordinarily important for their business. I think it's a nice, added benefit. I think if I were to build using Kajabi, which I did before, that is a $3,000, $3,800 product a year. There's no marketplace feature.
Now, granted it has a lot of robust features. For me, the reason I differentiate between those two is that I'm not a full-time creator. I have many different businesses and creation to me is more of a side hustle. And so I balance simplicity, ease of use versus all these bells and whistles that I'll probably never use. So that's why I chose Gumroad.
In terms of the marketplace, what does Gumroad do to drive incremental demand for the creators in addition to list your products on the marketplace and charge 10% on the transaction?
Guest: I don't know the inner workings of how they list on the marketplace.
One reason that I like it is that the focus is on the product, which I really appreciate. I was taking a look at a few different marketplaces, which focus on the creator itself. I don't like that as much, because I don't know those people, and I want to make sure that when I see myself in a group of people, I want to make sure that they're people that I want to be featured with and trust and feel like put out good work, whereas on Gumroad the product is just a product. So I like that.
Since the marketplace is product oriented and say maybe one stock market course is listed against 10 other stock market courses, do you think the customers could just price compare different products without having any knowledge on the creators themselves? What do you think about these price competition dynamics by listing products against themselves?
Guest: Yeah, that's interesting. I think my instinct tells me that people don't just buy the cheapest price product. I think what they likely do is they look at the cost versus the reviews. And it's pretty easy to see when a course is really well-reviewed.
If I'm thinking about different courses, let's take, for example, like you said, the stock market. I can see, I've seen some that are $50 that have two reviews, and I've seen some that are $50 that have 1200 reviews. And to me, part of my diligence is looking at the reviews, but also going and researching the creator.
Do you think because Gumroad has a marketplace feature, creators would choose Gumroad based on that?
Guest: I don't think so. I don't think it's as big of a difference. I made a couple of thousand bucks in sales. I think that's a nice bonus. I think to me, Gumroad has the digital creator in mind where Shopify has the physical creator in mind. That's what I feel is the difference.
When I look at Shopify, which I think is a great company, one of the best companies out there today. They have a lot of really great features, templates, web design, a lot of plugins, which are really nice.
I know I'm kind of beating a dead horse when I say this, but like what's most important to me is getting started. And when I go and look at Shopify, I think about having to build a website and then getting a bunch of plugins with me. I just want to upload my course. I want to hit save, and I want to share the link to people because to me, speed is the most important.
The flow of traffic is super important. The big social networks are like the top of the funnel, the upstream traffic for creators to build an audience. And then the creators want to redirect their audience into a more direct channel to cultivate their connection and monetize that way. What are some of the frictions in this process?
Guest: I don't see a tremendous amount of friction upstream to downstream. When I put a course on Gumroad, I go share the link. It's very simple. I put it on my social profiles. People can access it very easily. It's mobile designed. I like all that.
I think the friction is post-sale. I think the friction is engaging your audience. Most of the softwares that are available on the marketplace doesn’t have great community features.
So I think as Gumroad moves forward, I think as Shopify moves forward, Teachable, Podia, building more robust community functionality will be important.
There are some signs that Gumroad wants to open source their tech stack gradually, and there's a way of operating if they commoditize infrastructure and make the community the real value differentiator. How do you see the future of the platform being more of a commodity and the community brings most of the value?
Guest: I think that that's probably likely. I think that all of the different software that you can use today, Kajabi, Shopify, Gumroad, Podia, Teachable, there's a tremendous amount of similarity and features, especially at different price points. Gumroad is lower cost because it has fewer features.
Teachable and Podia are 8x the cost. And they have the same features. If I look at Teachable and Podia, they're very similar. So I think the differentiator is going to be how easy it is to engage with your audience.
And I think companies like Patreon, if they make it difficult to leave or they build a sticky product so that you can't take your audience with you, I think that will be a significant detriment to their growth.
What we're seeing right now in technology is much more open-source movement, sharing, a lot less cutthroat venture capital-backed companies in this space and more of the Gumroad type of mentality, which is another reason that I feel trustworthy towards their brand.
For these community features, there are also companies like Circle or Mighty Networks. Do you think creators will use different tools and stitch them together or do you see, there will be a one-stop shop of a very integrated platform, which provides all functions? For example, Kajabi is moving towards that direction with their community feature.
Guest: Yeah, they are. Yeah. They are moving that way. I think there are two camps or schools of thought. In my opinion, one school of thought is to make it easy.
So Kajabi makes it easy. It's pretty good at a lot of things, right? Their websites aren't super beautiful or flexible. Their community feature is not super robust, their email platform leaves some things to be desired, but all in all, for the price and the feature set, it's a pretty good product.
But it doesn't do one of those things phenomenally well.
To me, the thing that Gumroad does phenomenally well is access to their products. It's easy to buy. I don't fill out a form, I put in my credit card details and I'm buying. It's very simple.
I think that creators who are full-time creators will want the best of each part of their stack.
And so they'll use tools like Zapier to integrate Stripe, Shopify, Gumroad, Circle, Mighty Networks.
I know there's no tool on the market right now that meets all my needs. And so I've chosen to keep it simple rather than expensive.
If you recommend one platform to an average creator, which one would that be and why?
Guest: It would depend on what was most important to them. I consider myself a very average creator. I use Gumroad. If I were to move to another platform. I think one that looks appealing is Podia.
I think Podia has really nice features and really good audience engagement. I've only used a free trial before so I can't speak to the full year-long commitment to Podia. But I would say that if any solution was going to give Gumroad a run for its money, for me, I would be most interested in looking at a solution like Podia.
How is Gumroad’s customer support? Especially in helping beginner creators to gain this upward mobility, to understand distribution, pricing and how to find an audience?
Guest: They didn’t use to do a whole lot of that. But recently that's changed. Recently they did the 14-day product challenge. They did the five-day email challenge, and now they're doing an audience growth challenge as well.
That's pretty cool for our first-time creators. It's a hand-holding. That's what beginning creators need.
They need the basics. In terms of customer support outside of that, I just DM them on Twitter and that's how I reached them. They were pretty good at getting back to me.
Kajabi did a nice job at support because they had live chat support that was easy to use. But for the difference in cost of 290 bucks a month, between the two, Gumroad DM on Twitter works for me.
What do you think about products like Linktree?
Guest: Yeah, I like it. I just signed up a few days ago because I thought I'd give it a try to see if it might increase conversion rates for me, I'm all for the simplicity.
I think we're moving away from web design. Web and branding that is very complex. And I think we're moving towards a more simplistic design, ease of use, better user experience. I like the fact that linktree is so easy. I can list my links there.
People click on them, find my businesses very simple. So I appreciate the aggregation of my businesses in a very clean and easy-to-use interface.
How do you optimize your time across different platforms?
I have a two-fold thought on that.
Number one, I have a strong channel. My big channel is LinkedIn. That's where I have an audience. I'm not as followed by as many people on Twitter or other social media platforms. So I like to spend the most amount of time where I get the biggest bang for my buck. And that is a platform like LinkedIn.
I think as long as you're creating content, you might as well put it in other places too. And so my second take is that, while I create for LinkedIn, if I'm going to create for that and might as well put it on Twitter, indie hackers, on my blog post, and now I'm trying to figure out a way to stitch together all of those things. So I can start moving my LinkedIn audience to other places and eventually into my email inbox. So that's how I think about spending my time.
Is there anything that you think is important for Gumroad and the wider creator economy that we haven't talked about?
Guest: Yeah. I think that as more and more people turn to creating a second income stream to live their lives, I think vetting is going to become really important and diligence is going to become really important.
And today, I don't know that there's one place other than reading the testimonials where you can truly understand how good this person really is at what they say they're good at. I think as the world goes further and further into that, we'll start to see companies that pop up and make a living by vetting and recommending high-quality creators, much like you see a G2 crowd or a Capterra for software.
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