DTC POD #255 - Anders Bill & Andy Cloyd, Superfiliate: Custom Storefronts for Creators
What's up, DTC pod? Today we're joined by Anders and Andy from Super Affiliate. So, guys, I'll let you kick us off. Why don't you tell us a little bit about your backgrounds and the product you guys are building.
So prior to starting super affiliate, I had spent the last seven years doing early stage software investing and a little bit actually on the D to C brand side. First investment I ever made was actually in a direct consumer brand called Somersault, and then started to spend a lot more time on the ecommerce stack. Everything from returns, reverse logistics, secondary marketplaces, moved out to Los Angeles and moved into a house with a bunch of strangers. And Anders happened to be one of those strangers, and he was our lifelong entrepreneur and asked me to start this company with him and converted me over to the founder side.
Amazing. Yeah, Andy and I have tied our fates together, I guess a little background on me. I spent the last eight years on the software side, so I had co founded a music technology company that's like back in the day when those APIs were really open. Like, Spotify had an open API, if you remember that, and then four years later started a company called Darkroom. By the way, it's a really awful idea to try to bootstrap a music technology company. It's just super, super Difficult. And then four years later started that company, Darkroom, with my co founder Theo there. And long story short, that business is essentially an API for fine art print providers that helps photographers and graphic designers sell their physical work.
And bootstrap that business of plenty of times where I was like, hey, we Bootstrap. Rah rah. I'm glad we didn't bring in money. And then other times after meeting Andy, I was like, man, I wish we had brought in some money and scaled up that business and started investing in different CPG companies, honestly, around the RAh raw train of good for you CPG products. And then started to see, honestly started to see a lot of the contracts they were receiving on the word of mouth. To see. And word of mouth, by the way, is a really big category. There's all the subcategories that exist within that.
There's referral loyalty, there's ambassador, there's affiliate, there's influencer. And fundamentally, we really felt like the softwares really were linking code CRMs. They helped you manage discounts, they helped you manage codes. And what we wanted to do is basically automate the creation of personalized storefronts for your best customers and creators. Where if I followed you, Blaine or Raymond, I click on that link right now, I go to a PDP or a shop, all page, you're gone. You could have sold me any product in the world, and I would be there because of you. And marketers are building co branded landing pages. They just haven't been able to build that front end infrastructure to match the scale of their word of mouth.
So, yeah, it's a little background on myself, and then there's a really quick pitch on super affiliate, but we can kind of take it anywhere.
Ramon Berrios 00:03:21 - 00:03:40
Yeah. So can one of you guys walk us through the workflow of how a brand. I just want the audience to sort of get context of how this experience really works. So who is in charge of creating this custom landing page? Does super affiliate do that? Does the brand, does the creator, how does the workflow work?
So I'll jump in and then Andy, maybe tag on with other stuff, because there's so many learnings. I feel like every merch we talk to. So a merchant will come to us and we'll kind of diagnose where they need the most help in word of mouth. We can engage in all those subcategories. They may have a referral loyalty contract that's not up for six months, but they have 300 affiliates or influencers they want to work with, and so we'll engage with them and kind of like wherever their needs are. On the word of mouth side, when it comes to the actual storefront, we serve the merchant here, right? We don't serve the influencer. It's not multi brand, and it's not like requiring the influencer to choose a bunch of products. The merchant and ourselves are actually building the landing page.
So we have a landing page builder within our app. We'll end up building that landing page. For them when they come on the app. We plan on doing that for the first X thousands of merchants we work with, because they're used to going to an agency and paying five to ten grand, waiting two to six weeks for a landing page. And then all of a sudden they start working with super affiliate and there's a landing page in the app, and then all of a sudden they add 300 super affiliates and there's 300 personalized storefronts that are built for their customers. And their customers can optionally go in and change the hero content to be a piece of their UGC or curate their favorite products they want on the store. So little work is actually on the customer and creator side just for this reason of, hey, we're all kind of, we have so much going on. Creators and customers do too.
You don't want to break any of their current workflow and just give them the same workflow of sharing the link. But Andy, anything you would add there too? Because I feel like every pitch, we're evolving that narrative for the needs of the customers.
I think ultimately it's just to, you know, we're taking on that with the merchant, but we just want to enable these people to share a new, fresh know. To Anders Point earlier, on the CRM side, it's like people are used to just getting these cold links that just send you to a homepage, and we just want to enable them with the brand's best content that they've already spent a bunch of money on. We want to enable people to put the content that they're making for a brand on this site and ultimately also drive attribution and rewards for that. We want to bring them into the reward structure of sharing a brand and what it means to drive revenue for these brands and make sure that they're participating in that beyond just making the piece of content or what they're getting paid for by the brand.
Ramon Berrios 00:05:49 - 00:06:30
Yeah, I love it because you're removing all the friction points of getting someone's attention when they're the most intrigued, and that is the first time that they get to interact with the brand and then according to who referred them to the brand. But I also want to take a step back to, there was a lot to unpack in terms of your background and how you got to work together. So first things first, you both met in this house and decided to start a company. A lot of people know how hard it is to find a co founder, and then you both came from these opposite worlds to a perfect combination. What was the process like from when you guys met to actually coming together.
To super affiliate, if I remember right. I can kick that off, Anders. But there was a time I had moved in. Anders was friends with everybody else in the house, and I was kind of like the random guy filling a space. But there was this crazy guy that was down there at, like, 03:00 a.m. Brainstorming every night. I was actually working East coast hours, and sometimes we would overlap. I'd be waking up, he'd be going to bed.
But he was always the idea guy. And just had come from that background of building companies, starting from scratch, being lean, being scrappy. And ultimately, he came to me and was like, hey, I think we could be great partners on this. You know, the investment side, you know, the business development side, you know, the contextual market as a whole. Now, how can we pair that with my experience, like, building great software and enabling creators like unders was at dark room. And the story sounds great in retrospect, of, like, we just went zero to right where we are today. And really it was just like getting in the gauntlet and building and talking to customers and just developing our relationship, frankly, alongside developing the company itself. And ultimately, that led to a very complementary co founder Dynamic that I think has been super helpful.
And you see that flourish as we go into certain phases of the company. There's the building phases, and there's the fundraising phases, and it's kind of like, we're kind of like picking up where the other one leaves off. But ultimately has enabled been a really unique opportunity to build a friendship and a company in parallel.
Ramon Berrios 00:08:02 - 00:08:36
Yeah, Blaine, I know you have more experience on the VC front as well, and we all do here. But getting someone who has seven years of experience in VC and say, come start a company, it was a big leap, definitely on your end. Are you still actively in VC? How did you make that decision, and what conclusions did you come to to say, all right, I'm going to make the leap? What was the evaluation process for that? You know, the risk that is on the other side?
Yeah, absolutely. For me, it was like, look, in investing, I found something that I love, which is helping founders build their dreams and the products and change markets that they have a unique perspective on. But in seven years of doing that, there was, like, one thing that was always missing, and it was that empathy of being able to look across the table and say, I've been there. I know what that challenge is like, and this is how I handled it. Maybe that's not how you should handle it. But from my personal experience, this is what I would do. And I just noticed that the investors that I looked up to were the ones that had been there and had done that, whether that be like my direct mentors at some of the firms that I worked at, or the VCs that you see that are out there on Twitter and things like that. So many of them share that common background of been there, done that, and have that empathy with the founder.
So I knew it was always going to be something that I wanted to do. However, I also knew that I probably wasn't like the idea guy, to your point, Ramon, of drop everything and just go into the abyss. So I was kind of passively waiting for that opportunity. And it was just like pure dumb luck that I encountered a founder that brought all of the idea and scrappiness that I was lacking. And it was really awesome in getting it off the ground because we were able to just go so much faster with that initial idea because we were able to go to some of the network that I had built throughout the investing career. And ultimately, I think that time when it was like, you got to go or no go, it was a pretty easy choice to say, probably not going to regret making that jump. Even if everything hits the fan and we fall flat, we'll pick ourselves up and keep going. So that was ultimately the experience.
And then to the point to the initial question of, am I still doing that now? I do serve as a venture partner at Revolution's rise of the rest fund, but largely that's just maintaining founder relationships that I had built in the past and frankly, weighing in on the EcOM landscape for them. Revolution is very active in the e commerce world with some big investments like bigcommerce, Swaypay, companies that are very active in the space and just helping them evaluate and grow those businesses. So get to keep 1ft in and keep the hat on a little bit, but ultimately spend most of my time building super affiliate with honors, Andy.
Also, coming from the VC side, it's really interesting because I feel like in VC you almost have add, where you're looking at all these different companies, all these deals, everything's coming at you so fast, and then when you're just building out one company, it's like the totally opposite thing, right? So what was that transition like? And how do you think about that going from looking at a million companies to really going all the way into the day to day at your own?
I think Anders would probably say that that add might still exist based on the barrage of slack messages that I'm sending on a daily basis. But I think it was really around taking a similar skill set of looking at a lot of different things and consolidating them down, but just like zooming one level lower and saying like, okay, now e commerce is your world. Your world is not like SaaS as a category. Your world is e commerce. But there's still a bunch of categories within that. And I think that's one of the things that Anders and I really have tried to do a good job of building this company is really understanding the context with which we're building the company and getting in the weeds, but also understanding that there are fundamental business building things that need to be done regardless of the category, and being able to make sure that we're on that trajectory that an investor is going to want to see. Because you can feel like you're building the best thing in the world for a small niche, but ultimately you have to be looking at it from a bigger picture to build a VC scale company where it makes sense to raise significant capital along the way. So I think it was definitely a transition in the sense of narrowing that scope a little bit, but then being able to be so present on the sales and business development side of super affiliate, it was kind of like taking a hat and applying it in a different context.
And I think that's a huge part of our approach to building the company is know everybody, help who you can, connect people in the ecosystem and just ultimately get a full understanding of what's going on in the market around you.
So another thing that I think that's really interesting about the state of VC versus founder and company today is I feel like before it was like everyone could build the, there was all this opportunity, right, for really big venture backable businesses. And then obviously then you start getting the long tail of software where everyone's niching down building stuff that's super, super niche. A lot of times I think companies are getting venture funding, especially in the last couple of years, where maybe it didn't really warrant venture funding, but they're still getting VC sort of deals. I think what's interesting about the space you guys are building in affiliate is if everything checks out the way you guys think it could and you're able to build that affiliate layer of commerce, that definitely is a venture backable thing. But I just love your guys'take. In general around bootstrapping versus VC. When should you think about saying like, oh, my business is a venture backable business versus, oh, I should look at different sorts of financing, not just because you're going to be wasting your time or maybe spinning your wheels for VC, but also, if you build the wrong business and you take VC funding, you can screw yourself down the line when it comes to exiting. If your business just doesn't have that high ceiling potential, you as a founder could get wiped out by taking VC funding when your business from the get go shouldn't have been a VC business to begin with.
So how do you think about that as a founder, making those sort of decisions? And how did you come across and ultimately make the decision that what you guys are building with super affiliate is actually a really big opportunity to go after 100%?
I think it's a great question and extremely topical, given the market conditions that we're in right now, and we're seeing a lot of businesses that are in a tough spot. To your exact point, Blaine, I think it's something that a lot of founders are going to be in a tough spot because of that position. And we thought about it from the start of saying, hey, let's raise enough to get us off the ground, because we know that in this overall broad affiliate space, even if we're just within the Shopify ecosystem, there's enough market out there for us to build a really nice business. Here. However, let's raise a milestones based fashion where a round is a means to derisking a next milestone or a next phase of the business and raise capital according to our needs at a given moment in time. So our initial round was we raised a million dollars, and that was enough for us to stand up a solid engineering team, a solid product team, solid design team, get a product to market, start to get a feel for customer propensity to pay, things like that, and put us into a position where we feel like we have the ability to forecast this business six months down the road, twelve months down the road, two years down the road, without pricing yourself out of opportunistic acquisition if it was to come or subsequent rounds of financing, and being able to just keep showing that incremental progress along the journey. And I think in the market of the last few years, founders got put in a tough position, because if you weren't going to do it, your founders were going to do it. And by it, I mean raise a bunch of money.
And when I say your competitors are going to do it. So when your competitors raise ten, you think, well, I better raise ten or 15 because they're going to be going fast. And I think now you're about to see a next wave of companies who are thoughtful in fundraising, or even just raised at a later stage in the market where that capital was not available. And those founders are going to be able to build more capital efficient businesses that put themselves in a great position to shine as a wave of companies maybe either fold or get rolled into other entities because they were weighed down with the capital that they had raised at frankly frothy valuations that was based on best case scenarios to be able to get to that next milestone.
Ramon Berrios 00:17:00 - 00:17:48
You mentioned one of the things, for example, is, all right, the outcomes are either the company shuts down, the company reaches like, say, IPO level, or a big exit outcome. And you mentioned that some founders might do a raise where they decrease the chance of an opportunistic exit. Can you dive into that, into how a founder can put themselves in a corner where now they missed their opportunistic exit? And how do you advise founders to keep that option open as they think of a strategic round? Because, like you said, market conditions. You don't know we have the vision on the company, but there are external factors that don't allow, we don't get to time what is going to be the ultimate outcome and when. So I think that would be awesome to dive into.
Absolutely. And I think when it comes to that, it's about keeping that optionality open and making sure that when you raise money, you're giving yourself a path to default alive. And by default, alive, I mean controlling your own destiny and raising enough money to where you feel like you can get the business to a point where you're not reliant on capital. But future capital rounds will be an acceleration of what you're already doing. And I think there will be some businesses where that's not the path to go. They need to go big, they need to go fast. However, I think that's a vast minority of businesses, I think, thinking about raising enough capital to get to that next point of derisk. And I think old wisdom that I was given at one point in my life is when you're thinking about raising, you should be talking to those potential strategic acquirers, not even necessarily if you're interested in the acquisition, but it's just a good exercise to get to know what's going on at that phase of company that's sitting above and looking down on the market that you're trying to grow up into.
And I think there's some great perspective there, but I think really what it comes down to is capital efficiency. It's making sure that you're getting the most out of that next dollar, making a hire that, you know, has a seat to sit in and a job to be done, and not hiring because you have the amount of money in the bank to do it, but being really thoughtful about that. And I think, too, there's different groups to raise from at different stages in the company who are going to have different expectations on what that outcome is. If you take money from a $3 billion fund, $100 million exit that they own 10% of does not move the needle. However, if you take money from a $20 million fund that they own 10% of and it sells for 100 million, you've returned half the fund. They're probably going to be pretty happy with that outcome. So I think there's also a component of thinking about who you take money from at what phase of the company, whenever you do have that line of sight of what is that next milestone and how that will play into the psychology of that investor or the return expectations of that investor.
Ramon Berrios 00:19:53 - 00:20:37
I love know. I think you guys make a great duo because there's all this advice coming out now on what you should do with a company. And, Anders, I can relate. I've built a Bootstrap business before, and the advice going around is to try to be cash flow positive. And all these things that people that have bootstrapped say, well, isn't this how a business should have been ran in the first place? But certain market conditions affect that. And so, Anders, what has been the experience like of running two Bootstrap businesses to then running a VC back company? What are the pros and cons you've experienced so far from each of those?
There's, like, so many scars, even on both sides. Honestly, I think on the Bootstrap side, there's also this overglorification of both, because there's these people that have gone down both paths, and they validate both Paths, and they're like, you should do this, and you should do that. You should do whatever's right for your business. At that time, and for us, particularly on the dark Room side, Theo, my co founder, and I there, we realized that the venture scale of that business wouldn't be realized until much later, when we had product market fit. There were times where we could have poured money on the business where potentially we should have. And obviously, it's so easy to say that in hindsight, I think the biggest limitations were hiring and scaling. When something's working, you're always limited by your revenue coming in the door, rather than, hey, we know this is working. We want to move on product, particularly in software.
Right? We knew we wanted to move. Obviously, this is the D to C pod, and there's a bunch of businesses here that are on the CPG side that are saying, hey, should we fundraise? Because this purchase order is massive. There's all these different type of dynamics that come in, and of course, there's cash advances. We really relied on cash advances, and the company still does. It's like, I think that's a really fun way to grow the business. You see Stripe capital, PayPal Capital, that's Wayflier. There's all these types of options that are there for alternate funding. Those are really fun to use.
And then on the venture side, I think there's this pro that you get to hire those people that you want to, but there's also the con that there's so much uncertainty in that, right? You take on a certain amount of burn and risk. We've been super, super lean pretty much throughout all the businesses I've run. We've just been very capital efficient, like Andy brought up before. But looking at this now, it's hard to, unless it's an absolute cash machine for me to tell someone to Bootstrap. There's so much glorification around bootstrapping. But sometimes you do find those businesses, wow, they're so cash efficient, they're so cash heavy and profitable. Don't fundraise or find an alternative way to fundraise, but to say, to not have an angel family friend round to get you off the ground and get you to product market fit, I would usually lean towards raising a small amount that's very reasonable and then taking it from there, but always depends on the business market timing and, of course, all the rest from the founder's perspective.
And I think it's also great that you guys have had both Perspectives. Right? There's like, a lot of founders who can only build a venture scale business, and maybe some who will only think in the bootstrap way. So just being able to probably temper each other and understand, like, wait a minute, maybe we can do this in a more capital efficient way. I'm used to building it this way.
And now we have capital.
That doesn't mean I'm going to flush it down the toilet. It just means it's going to be an accelerant to the business instead of something that's just there and you're like, oh, we burned through all this money and we don't have anything to show for it. So I think having both of those sides is probably a really good thing to have as a founding team.
Yeah, it's really funny. We were just looking at the financial model and the forecast right before we jumped on here, and you kind of heard Anders. Nice different perspectives there. When you're looking at when to bring on what higher. I think with the venture backed mind, it's like I'm the one month too early, and he's like, the one month too late type. So maybe if we just meet in the middle on all of those, timing will be just perfect.
I will say there's one thing that it's kind of this dark side of this conversation that I think is worth bringing up, which is, where are the exits? Right. Look at the exit potential of the company and look at who's buying. Right. I think the number one thing you can do is to align on who's buying these companies. Are we going to go public one day? Is that the dream and the vision, or are we a strategic investment or strategic acquisition? And this is really what's plagued. I think a lot of the CPG world. A lot of businesses got overcapitalized, and a lot of investors were allowing their founders to raise at crazy multiples that now it's overpriced for them to bring on an employee. And the employees aren't going to make any money even on an acquisition, unless it's an amazing acquisition, and there's just not enough people evaluating the acquisition market.
So I think it's going to be really interesting to see what happens in 2023 and 24 in the acquisition landscape. And that should also be something that new founders are looking at and saying, hey, what's the corporate development environment look like for us, building this company? Who's a dream acquirer? Put that on a board and work backwards. I think a lot of the exit potential gets overlooked and people go, how big of a business do you want to build? You want to IPO? And rather than, hey, I want to be a part of this company's strategic vision and mission and working backwards from there. Yeah.
And I think the thing about that that's really interesting is a lot of founders really think in really binary terms, right? It's the first day of the business, they haven't even built anything. And it's like, this is going to be the biggest thing ever, and we're going to IPO it.
And outcomes aren't always so binary. So just at least thinking and really being honest with yourself and knowing all of the options on the table from the get go, I think is a really smart way to think about sizing up your market, your opportunities and just being realistic because you want to have a Plan A, but you also want to have a reasonable plan B-C-D whatever it is. Okay, so moving away from fundraising for a second, one thing that I wanted to get into with you guys is just getting painting maybe a little bit better of a landscape for a store owner who's trying to get a real pulse on the affiliate and creator sort of space that you guys sit, right? So imagine that we're starting imagine like I'm a brand owner, I own a brand, and I'm starting out probably. Maybe I've created a couple Facebook ads and maybe I have some followers and some customers and maybe I'm starting to see some UGC come in that I've got tagged on posts or whatever else. So why don't you just paint us a picture of that affiliate landscape where you guys come in and where you sit so brands can start to understand how to leverage their community and their creators who are already loving their products, to accelerate their growth.
So we will always engage with a brand where we feel like we've talked to the founders, we've talked to their head of marketing, we've understood the community because the word of mouth strategy for a sexual wellness company versus a functional mushroom company is very different. And there's very different avenues where those will be effective and ineffective on social and really thinking about what word of mouth is, you have to go to the core of what the psychological motivators are of those individual groups, right? If you take a kind of simple approach of creators and saying, because creators still have a really broad category, but let's talk about like influencers and podcasters and newsletters, you have to ask what are their incentives? Right? I think the first wave of influencer marketing has come and gone and that has really been like, hey, pay us X thousands of dollars for this post. And it's brand marketing rather than performance marketing. Not because, by the way, you don't want it to be performance marketing, but because you couldn't get a positive one roas and ROI on that spend. And I think that was kind of this really dark side of influencer and creator that a lot of brands are waking up to. So we really, really push people to thinking about things on a performance basis. And that's across referral loyalty, it's across affiliate and cross influencer. If they have an awesome workflow for creators, we'll say, hey, what do they like? What motivates those customers? Would they get excited about an experience like this.
And the way that we have seen brands present sent that to their customers and creators is, hey, Blaine, we've made you a co branded landing page. And the people that get excited about that are the people you should be enrolling in this program. There's going to be plenty of people that are going to be indifferent. They're going to be like, oh, just give me my code, give me my link. But the people that really love the brand and have that brand affinity and are going to be excited are the ones that we really want to target. And we usually try to start with one program. We definitely are a consolidation play, right? People will come to us and run multiple pillars of their word of mouth strategy, which I think is nice because there's three plus apps on average brands are using for word of mouth. But in the end of the day, so much of those tools do the same thing.
But we'll always start with one and then we'll try to fully own it. We'll say, how do we recruit these people? We have a bunch of integrations with Klavio, Postsgrip, attentive, all the subscription providers. How do we recruit people in top of funnel? How do we activate them, how do we educate them? And how do we allow you to double down on the people that are working? It is almost always the Pareto principle. The top 20%, even the top 5% of people, the customers and creators, are going to be driving the vast majority of that revenue. And the problem is that you can't find out who those are until you filter through all the rest. And so there's really that filtration process that has to happen, but that's after activating and educating those customers and creators.
Got it. And why don't you talk to us a little bit more about kind of what you were mentioning on the importance of each creator having their own version of it, right. I know when a brand is having a really successful activation with an influencer, they'll whitelist their account. So there's real overlap and synergy between it. The brand is happy to show that this creator is really working with us and that sort of thing. So you guys are basically able to take that and scale it out. So each one of the creators has their own storefront almost, right, that they're selling to. So beyond that, then what happens? I know you mentioned about the importance of having different integrations into the different parts of the system.
What else are you guys able to provide to the brand once customers start to see these pages from their favorite creators and start to convert or make their way onto the site.
Totally. I think it's worth bringing up social commerce real quickly because it's a very buzzy term that so many people bring up. And then when we actually look at what the current state of social commerce is, it's really affiliate links that are next to a TikTok, Facebook or Instagram post that drive you to a PDP or a shop all page. And our pitch is that every single affiliate link and discount code that exists out there should drive you to a microcommerce experience that's fully contextualized to the traffic source. Right? So, hey, I follow you, Blaine, on TikTok, you're promoting X, Y or Z company. Let's just say it's an apparel company. I usually go to a shop all page with 700 products. Now I'm going to Blaine Times brand store where you've curated the top ten picks.
I'm there because of you. I'm really interested in what your review is of the product above all else. And of course, integrations are super important, right, for the recruitment side, for building a landing page experience. These are full landing pages, right? We want someone to be able to come to us and say, hey, we have six web properties and all of a sudden with this program, we're now going to have 6000 micro web experiences that we'll be hosting through you all and that it scales up with the size of our word of mouth program. So we view that. I guess it's probably worth mentioning. We think the brands that are going to be really successful in 2023 are the ones that create a feedback loop between their customers and creators, the content they're making and the front end experiences they can offer them. And brands aren't really equipped to offer them those front end experiences, right? If we can offer the same caliber of experience that they get with an agency, building a singular landing page, but have that scale to the size of their word of mouth program, you start to see how this world transitions in the social commerce side from, hey, this link to a PDP for this link to a super contextualized experience that's super tailored to that individual.
No, that makes a ton of sense. And I just think the way in which commerce and ecommerce just continues to evolve is it's not like one size fits all. I think there's going to be a massive portion of commerce that can happen, like you were saying, where the lens at which the consumer thinks about making the purchase decision is through that of the creator that they're following. So when they get to that page and they're already shopping in that format, then they want to be able to go through the format of seeing the ecommerce store through the lens of that creator. But by the same time, that doesn't discount the fact that there's going to be also the other native shopping experiences where you're going to come to just like the sites page. Or maybe you find them through Google, or maybe you find them through all these different places. So I think it's just exciting to understand that as the landscape matures, there's all these different ways that traffic gets driven to the site. And what you guys are really focusing on is you're saying, hey, there's a ton of traffic that's actually getting driven to these brands through creators, influencers, et cetera.
Let's focus on providing the link between that format of commerce and when they actually get to the site. So it's not just, okay, the creator drove them to the site and now it's just a singular storefront, right?
Totally. I think there's this first wave that happened. Andy, I'll ping it over to you because I know we both see this so often in the first wave of creator commerce, it was like, hey, let's put a buy button right away, right? Let's put it right next to the creator rather than let's build them. An experience that allows the customer to go from the full journey of discovery to conversion. And jamming a commerce experience right next to an entertainment experience is a really interesting problem because you want to kind of blend the worlds of entertainment and education to ultimately drive the conversion. And that is really the things that kind of play in conflict and you're really trying to marry them there. So we're really trying to allow those experience to marry the entertainment and education component. Andy, jump in there.
I think there's so much we've learned around the commerce experience from that.
Yeah. And I think some of the recent announcements from Instagram, for example, regarding Instagram shopping and their decision to deprioritize that shopping tab, I think comes to that point that Anders just mentioned there. It's like, why are people coming to Instagram? It is not to shop. It is to be entertained. Now there are ads interjected in that entertainment experience, but it's not happening in that same property. And when you link out to this page, you're keeping that creator in the loop of that experience. However, you're also giving that brand the opportunity to tell the brand story. Why should I buy? How do I buy and execute it there? So you're kind of creating that interstitial experience.
And it plays to Blaine, to your point, that paradigm shift of me as a brand owner, I used to see 95% of my traffic come from putting dollars into meta and Google, so I knew where they were coming from and therefore I could optimize my experience for that singular traffic source. However, now that traffic is hitting me from ten different places or 100 different places, and it's like, how can I now optimize a commerce experience for all of those sources? And it's not going to be personalization on the home page where I-A-B test changing a button here or there, it's actually going to be a creator saying, here's my experience with the brand, this is why I use it. This is why you should use it. Also, click below and you can buy. And it's just close the loop really quickly there.
One follow up question that I had for you guys and how you guys think about it with, I know, meta, like stopping pulling their commerce section. Why do you think that? I think we know why it didn't happen. It wasn't like taking off and it was probably just like taking more resources. But where do we go from here? Right, commerce, that seems like a pretty big initiative for them. Are they going to remix it and try a different way to phase it in? Are they going to take more of an affiliate route? Where do they fall in that commerce conversation? Because they clearly own the platform where all the content is being created on the Instagram side of things.
So where do things go from here?
Totally. So on our side, I would recommend anyone who's listening at this moment to pull open their Instagram and click on their Instagram Stories and start swiping to the right and see how many of your friends stories you can get to without getting an ad. I guarantee you you can't get more than five. I rarely get more than three.
I got one. I just got one.
One. Okay, keep going and you'll probably get a couple of doubles. So if you think about what that means, there's this saturation that's happening with their ability to interject ads into that experience, right? They're pushing video really hard. I don't think their removal of shop is actually this massive unwind of their shopping and commerce strategy. I actually just think that they are changing the way in which they are doing commerce rather than separating the two and making it seem like they are two separate things. They're trying to go more of their stories route, which is how can we embed more of the commerce experience into an organic post? And candidly, they should be going the way that we're going. They should be thinking heavily on the merchant side and leaning into these top merchants in the same way. And I think this is kind of the least talked about thing in e commerce.
People talk about scaling up software companies. So much of software is service based in the e commerce space. You look at Shopify, Shopify plus is very service driven. Klavio and their top merchants very service driven. Right? You're like onboarding people and building these flows. I think you'll see a shift in metastrategy to continue a service based component with onboarding a lot of these top tier merchants and then continuing to try to go more and more organic. Where that goes from here, I think it's going to be very different to how you're seeing it in China. It's absolutely not going to look like social commerce in China for many, many reasons.
I think there's a lot of white space. I'm personally very bullish on in the next three to five years, a medium change happening to augmented reality and everything becoming totally different. And I don't think there's going to be a breakout social Commerce app that's a standalone app or platform in and of itself until there's a medium shift, until the form factor of actually interacting with a product changes. And maybe that's at a left field, but I just don't see another player coming in and being the platform there. I think it actually requires a medium shift to truly have a change in social commerce.
Ramon Berrios 00:38:12 - 00:39:33
I love that take because I have a pretty similar take in the sense that the things you've seen in social commerce in China, they're not happening here. And I think there's like cultural barriers and things. That infrastructure of social commerce app, you have WeChat, which is a very different way of sort of bringing everyone together, a totally different social commerce experience. And if it was truly that China is just ahead a few years, live shopping would have taken off insanely here. And yeah, there's some numbers to make up for it, but it doesn't have the rocket ship growth that we expected and predicted it would have. I mean, how many apps came out with live shopping? And even like Pinduo Duo, which is this huge company in China composed of group buying and communities, neighbors in US barely talk to each other. So I feel like there's this cultural barrier in things that doesn't just translate the success that we see in shopping and social commerce directly into United States, the one we see in China directly into United States, as you would see in fashion in Japan, that then just comes here and things like that. So that's just my hot take.
And I think a lot of that, Ramon, is on intention. It's like, why are you opening the thing that you're opening? And I think, to your point, in China, like that consolidation into something like a WeChat, there's a lot more intentions. You open that app for a lot more different reasons, and therefore you're exposed to a lot more different things and you end up doing more things on there. However, here those things are a little bit more bifurcated. It's the same way that you look at PayPal or a Klarna. They have all wanted to become this place where you start shopping, and that's kind of been their big vision. It's like, I come here, I figure out what I'm going to buy, et cetera. But those just are not discovery platforms.
And you have to have a huge shift in consumer behavior to actually become a discovery platform. And when that intention is not there, it's really hard to convince people to start coming to your app for a different reason than they were initially coming to.
Ramon Berrios 00:40:24 - 00:41:27
You know, Anders mentioned the education part. It's likely what is driving the conversion. And this is why TikTok was able to come out of the blue and take over Instagram, because it is context based and is education driven as well. The content can be informational. Some of it certainly has no context at all. And the algorithm will give you whatever it is you prefer, but it's not just saturated with buy this and this visual element that Instagram had. So what you guys are doing is combining those two and say, let's blend the education in the context of what works, but let's tap into the people that already have the distribution, rather than us having to build it ourselves or the customers have to pay for it. So when a customer comes to super affiliate, I want to switch gears a little bit into who is the ideal customer that would be a successful customer with super affiliate.
Ramon Berrios 00:41:27 - 00:41:54
Do I need to build my own ambassador team? I'm probably thinking, what is the difference between an affiliate, an ambassador, an influencer, a creator? I'm sure you guys just hear people saying all these words and you have to take a step back and say, well, first, define to us what you see as an ambassador, as a creator. So, fitting all that into one question. Who is the ideal customer that is prepared and ready to make superfilia a success.
It's a great and evolving question for us, and I think there is this moment we always have with merchants where we have them define what those different categories mean to them. And what we've seen is so many merchants are doing one of two things. They're either working with an agency for one or many of those subcategories, or they're in housing, right? So they're saying, we have a head of influencer. We're seeing it most commonly now be ahead of influencer, where that person has become so important because they're also sourcing content for paid media. So it's not just an influencer strategy on a performance basis. It's how are we also sourcing video content that will whitelist or just push on UGC or to drive conversion on like a video experience on our page. So we do see that happening a lot where they're hiring it in house. I think an ideal customer profile for us is $5 million plus because they have some level of brand affinity, they have some level of traction with their audience.
It can be smaller, of course, we've seen success of smaller merchants, but it's usually a good sign. So 5 million plus in growing a product that also has a share worthiness to it, right. Not one that's like primarily, let's just say like a workout sleeve that you're going to probably switch over to Amazon right away because you want it really quickly. Right. You want something that has this real ethos to it and has these brand values that people want to communicate. And we mainly look for finding a champion inside the organization. I think there is always this need to find a champion of your software. If you just turn on a word of mouth program or an affiliate program and think it's going to work for you, you're unfortunately mistaken in the sense that it requires so much work, it requires so many touch points.
You're really trying to overlap the peak moments of brand affinity with a touch point about the program, whatever program it might be. So whether that's referral, whether that's influencer, and I think what we're really seeing on the influencer side in particular is brands are trying to work with 300 to 500 influencers a month to ultimately double down on the top ten to 20. Right. Because there's going to be a bunch that don't perform, a bunch that are just pushing the product. And what we're seeing is that the ones that you double down on, they're the ones that are really excited. They've educated their audience, their audience has a high trust with them. A lot of these creators have kind of lost the trust of their audience and they've just been promoting a bunch of products. I actually don't think you can do that anymore.
If you're trying to be a successful creator and make performance driven results happen for yourself and the brands you work with, you have to look at those as partnerships rather than a promotion. It's like, hey, I want to work with this brand over the next two years in a partnership and be able to run that. So it requires all these mindsets and levers internally and externally.
Ramon Berrios 00:44:27 - 00:45:02
So how do you guys handle the creative that goes on a page? I'm asking because obviously that's what we do at trend and we always push our customers to have a stacked creative pipeline. There is no such thing as having a surplus library of content. But in your case, given that it's tailored experience, who is in charge of filling the content in a landing page? And then what are the things you're seeing that brands are doing right and wrong in terms of having creative in their pipeline?
Yeah, it's always on the merchant to build the scaffolding. So to build the basic version of the landing page that has this photo video content on it, like Andy said earlier, they probably have some awesome photo Video content They've probably gotten from trend or from their influencers and creators in their kind of repos that they're pulling from. So it's on them to build that basic version. Those customers and creators can then select which of that content they want to have on their storefront and then if they want to, they can upload their own content. What we've seen a lot of brands do is upload the content for that customer or creator. If you want to reduce friction and say, hey, Andy, we've built this awesome page for you and you click on that link and all of a sudden Andy, as the creator, sees the video he's made already on that link and doesn't have to do. You know, it's just such a simpler experience. They can do that on their end if they want to, but we really recommend the merchant doing the majority of the work there and then making it a very surprise and delight experience for the end creator or customer to interact with.
And then as new products come out, hey, here's an exclusive product we want to release through your storefront. Here's a cool piece of photo video content We've gotten from our agency that we put on your storefront and you can use it as these activation levers to just really get more success out of your customers and creators.
Cool. And guys, as we wrap up here, one thing that I'm curious about. I know we covered like, funding in the beginning. You guys clearly raised some money, built a dope product, and are in the process of really taking things to market. So where do you guys stand at the moment as we talk now? And what are some of the goals that you really have for this year? Whether it pertains to new brands, partnerships, products that you're currently building out, what does the roadmap for this year sort of look like?
Yeah, I'm happy to take this from that. Like I mentioned earlier on, that kind of like milestone based fundraising is we raised that initial slug of capital to get a product in market, get feedback, and get us to a point of figuring out, hey, where do we think this is going to go? We've been able to drive that to close, to break even now. And now we're thinking about what's 2023 look like? And we think that that's really going like zero to one and completing a lot of parts of the organization. It's getting some marketing going. We didn't even really have a website up until December of last year. We're thinking about taking partnerships from zero to one. It's Anders and I today trying to manage those, manage merchants, manage our team, all of that, and just bringing in some people who this is what they do and bringing in some experts and helping us continue to grow and scale, and we're planning on raising some money to do that. But once again, being super diligent in how much money we raise, where that money comes from, and then, frankly, what we're going to do with it.
Ders, I'll let you go a little more on the product side and kind of your vision here for this next year and iteration on the product.
Totally. The vision is to be the front end infrastructure to the way that brands look at working with their customers and creators on the word of mouth side. And what that means is I want to be known for the best mobile video first storefronts that are on the market, where people are looking at the storefronts and going, how did you build this? And instead of people saying we spent tens of thousands of dollars, they said we went to super affiliate and we dragged and drop a couple of components and it was super easy. I feel like so many of the page builders that are out there are too complex. They're allowing you to change the padding and most marketers are like, I don't care what the padding is of this section. Tell me what performs the best, be highly opinionated on the design side, and give me something that works. And that's what I really want to build for marketers. I want to build some systems for them to just simply test out a bunch of different mobile storefronts and ultimately have the ability to double down on the people that are working.
That is not going to change. THe things that are certain in the next twelve months is that brands are going to have to continue to filter through their best customers and creators to find the ones that are performing the best. And ideally, we're the front end infrastructure to convert their audience at the highest rate, but also to see, hey, who is converting the best. Okay, Blaine is really crushing it for us. Let's reach out to him, let's talk to him, let's enable him with X, Y or Z. And so that's where I'm really thinking. That's where my head's at, building a lot of the front end components. And then I think there's going to be so many things that come up as we look at how the ecosystem is changing, particularly with TikTok and Instagram being the major players.
We kind of act like it's not an oligopoly out here, but it really is. So we'll be really focused and seeing what they're doing and moving.
Got it. And for our listeners, where can they connect with you guys? Where can they find out more about super affiliate or you guys? Are you guys on Twitter? Linkedin. Why don't you just shout out some of your socials?
Totally. So you can always email us at andyouronders@superaffiliate.com. It's S-U-P-E-R-F-I-L-I-A-T-E. Not super affiliate, but super affiliate.com. And yeah, that's the main source. You can find our Twitter on there. It's just at super affiliate. So we're usually on Twitter and LinkedIn.
And then you can always email us, of course. Sweet.
Well, thanks for joining us, guys. And we can't wait to see how you guys continue to grow through the rest of this year and onwards. So can't wait to sync back up with you guys as you continue to develop the product.
Amazing. Thanks so much.
Thanks, y'all.
Ramon Berrios 00:50:13 - 00:50:14
Thank you.