From Selling a WordPress Business to SaaS with Justin Ferriman
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Brian: [00:00:00] You're about to hear my conversation with Justin Ferriman. In this one, we talked about his exit from a major WordPress plugin business into figuring out what's next. Let's get into it.

So I'm about to roll my conversation with Justin Ferriman. We recorded this conversation on November 10th, 2023. And we talked all about Justin's building up and then selling of LearnDash, a major WordPress plugin in learning management systems. And then we got into what Justin was thinking about next in terms of his next act after the sale of his WordPress business.

It's a good one. Enjoy.

Justin Ferman, welcome to the show,

Justin Ferriman: Well, thanks for having me, Brian. I know we were talking earlier that we feel like we've met each other in person, but we couldn't figure out where that, where and when that was

Brian: You know, [00:01:00] I think most of my conversations on this podcast start with exactly that. It's, you know, I, I love to like, invite people who I'm sort of like friendly with on, on Twitter and, and whatnot.

Justin Ferriman: Mm-Hmm.

Brian: just folks who I just think are doing really interesting things, and especially going through interesting transitions.

And this podcast is basically my excuse to to meet in person. So

Justin Ferriman: Oh, it might happy to be here.

Justin's business transition to coaching
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Brian: So I mean, Justin, you, you, you know, a lot of folks know you as the founder of Learn Dash which you've exited a little while back. So I want hear some of that story, but I'm also really, really interested to hear more about the transitions.

That happened sort of like before and after that exit. I know there was like another SaaS product in there. And then most recently your, your coaching. And I mean, I'm super interested in like, really like all of those things. Like I'm, I'm running a SaaS right now. I'm actually this isn't super public.

Maybe by the time this goes live I'm actually starting to craft my own coaching service as well.

liKe a like a side coaching offer pretty [00:02:00] soon.

And of course my SaaS is for, for coaches too. But anyway why don't we kind of step back and before we go back into your story, how do you describe what you're doing today?

Justin Ferriman: Today I work with founders of. Let's call 'em remote businesses. It can be software or selling digital products. Everybody's, I've people from startups like pre-revenue to seven figures, multiple seven figures. And I coach these founders on, you know, completing their, their goals and their tasks and challenges ahead of them. A lot of conversations and strategies around marketing and brand positioning. 'cause that's somewhat of my forte, but everything in between from personnel management to eventual exits, which I Have the experience with now and really being that sounding board, I found as a founder that I didn't really have as many people to kind of bounce ideas off of.

I had a few in a trusted network, and that can be really valuable because everybody's used to reporting to us. But as a founder, like who do we report to? [00:03:00] Who do we go to for ideas or

inspiration or just gut checks?

Brian: Yeah, a hundred percent. I've only actually just recently started working with a coach a couple months back. And like for, for many years I've had like mastermind groups and

kind of close circle of other founder friends that I would get advice from. But um, even, even with them, and I share a lot with them, but like, and there's always like good feedback and, and whatnot, but

It's been pretty eye-opening for me. Just working directly one-on-one with a coach.

Justin Ferriman: Mm-Hmm.

Brian: it's, it's really a much deeper, more, more sustained relationship with advice and feedback. 'cause it's like someone who's like in my business every single day, but much deeper into the business than friends who have a little bit more of a surface level understanding of things, you know?

Justin Ferriman: Yeah. Yeah. that's I think you hit the nail on the head. That's the value of having a coach and there's like the, you know, holding yourself accountable to the promises you make to yourself. [00:04:00] And so, you know, the coach helps with that. Masterminds are great. I've done those too, and there's kind of a aspect of that in what I do today, which I'm sure we'll get to in a

little bit more detail.

Highlights of building a business
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Brian: I wanna, I want to ask about it. I was looking at the website and, at bright growth.com. And so we'll, we'll get into that. I wanted to, like, I know that you, you've structured, you have kind of an interesting structure on that. bUt let's go back, I mean, so with Learn Dash we don't have to kind of like rehash at the whole story of that, but um, I mean, at this point today, how do you sort of like look back on your time, you know, starting growing.

We'll, we'll get into the exit, but like maybe the, the years of like actually building that business. What, how, how do you look back on that these days? What, what are like the big highlights for you?

Justin Ferriman: Well, I think the first big highlight was that transition to it from my full-time job. The, my story of Learn Dash Agile, I was doing it for eight years

roughly, and there was a lot [00:05:00] of changes in kind of what Learn Dash meant to me or what it was in my life during that time. Prior to LearnDash, I was a consultant in the e-learning space, so kinda the similar industry. And I was on the road every week, Monday through Thursday, Monday through Friday in hotel rooms with clients, and I loved the industry, but I hated that part of it, not controlling my time, being told where to go and , and being in airports and airport delays and so on and so forth. I'd always had this entrepreneurial mindset and dabbled in different things and had plenty of failures beforehand. And I was, I remember very vividly I was in a conversation at a client site about a learning management system, and we were talking about which one we would use for their big corporation, and the concept of open source LMS came up and at the time, and still today, Moodle is one of the more, well-known open source

Brian: Hmm.

Justin Ferriman: learning management systems.

Taking advantage of untapped markets
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Justin Ferriman: but I had a hobby with [00:06:00] WordPress just on the side doing businesses here or there, and I was like, man, that'd be really cool if WordPress had an LMS, and they didn't. I went, and I remember I looked it up in the hotel room that night. There was nothing there, and so I started blogging about that concept.

This was March, 2012, started blogging about

the concept

Brian : I gonna ask 2012. 'cause like now there are definitely a whole bunch of

Justin Ferriman: yeah,

Brian: for, for courses

Justin Ferriman: I know. Well, it's funny like, 'cause I just Googled that, right? WordPress, LMS and nothing. And so that to me I was like, okay, there's my keyword I'm gonna target 'cause nobody else is calling it that. And yeah, I blogged, I put a little sign up at the top of the page, you know, like find out when it's released.

I didn't know if I was gonna release it.

And I just started blogging about e-learning and sometimes WordPress, Andy learning and just things I liked. And a few months later I decided to have it built after a few thousand people signed up for this email list. And so found an agency 'cause I don't know how to code, I'm not technical in any way, and found an agency to build it.

They built version [00:07:00] 1.0 and January, 2013, I launched the product. Probably like the worst possible way. I think I, I launched it at midnight which is, it's so, I just, so stupid when I think back on it. But yeah, I launched it and four months after that I left my career to focus on it

Brian: Oh wow. That fast just. Did it, did it grow that fast or did you like have some like runway to, to go out on your own and, and get it

to profitability?

Justin Ferriman: just growing that fast. So I, in the, in between time, I found a developer, a contract developer to be the person that worked on the code after the agency, and I reinvested every dollar back into fixing the bugs and fixing the

issues. And then I would just focus on promotion and support because I could do that. And It was, you know, there was a, there was a little bit of a bump obviously at the release. It wasn't a huge release. I made a good chunk of money, which I thought was good. I mean, I don't even remember what it was now. Maybe it was like eight to [00:08:00] 10,000 bucks or something. Right off the launch. And then it kind of like the, the lifecycle of a market usually is you release something. And then there's like this delay effect where you get a bunch of adoption and then there's this pullback as the market decides, is this worth it? And then if it is, they start telling people and start blogging about it or whatever. It starts to pick up again. So that's what happened

in January, kind of had this hit. And then February it was shaky. I didn't know where it was going, but I was like, okay, at the very least, you know, I made my money, my money back at this point. And this maybe is my side income. And then. In March, late February, and in March it really picked up

Brian: Do you remember

Justin Ferriman: making,

Brian: oh, sorry, sorry. Go ahead.

Justin Ferriman: no,

I was just gonna say I was making more than my, what I was making in my day job. For far less effort,

Brian: Wow, amazing. I mean, you know, for folks listening to this I'd imagine what some people are hearing is, you know, right idea at, at a really good time before LMS is worth a thing [00:09:00] in, in the WordPress space. Then sort of like launching it and instant growth. I mean there, there must have been some tactical things that, that really made a difference.

'cause you know, obviously just like putting a website live doesn't mean it's going to grow. Like were there, were there key partners or, or places where you were able to like publicize it initially to get that initial bump of, of traction, like right outta the

Justin Ferriman: Yeah. I mean, it was never maybe one big thing. I probably did several things intentionally well and other things. Lucky timing obviously was one. What I did that people weren't doing before is I connected the dots between memberships 'cause they were membership plugins, but like why? Why do you have a membership plugin to have a course? So I just connected that dot of, okay, you're actually selling courses and implemented more course features, like tracking of your progress quizzes within this membership site. So [00:10:00] that I think resonated with, with folks. That wasn't like my intention. I think that worked.

Using your audience to promote your products
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Justin Ferriman: prIor to the launch, I did this strategy.

I, I don't remember where I read it from. It wasn't my own, but I had this email list and so I email emailed everybody and said, Hey, I'm gonna be releasing this soon. I'm gonna give away x number of free copies. I forget how many, and if you write or post on Twitter, or write a blog post or something about LearnDash and what's coming. And so I think there were like 50 people that did that. I mean, not, it was a decent amount, not a lot compared to the list. 'cause I probably was like 2,500 people on the list

at the time. And

Brian: like regularly blogging and like you had a bit of a

audience

Justin Ferriman: I, I, I blogged at least three times a week, sometimes four. And then when I went on my own, I blogged every day for at least two years. That was the main driver and by the time I exited the, the website got over a million visitors a month, many of which see the blog.

So the blog was the main workhorse. [00:11:00] aNyway, so I did this little contest. People submitted, Hey, I wrote this, I wrote that, and I gave the way the winners of some randomizer. But what I did after is I emailed the people that didn't win and said like, Hey, thanks so much. I'm gonna give you this super discounted price. This think was like 29 bucks, 29 bucks as a thank you for the next 48 hours, and like every one of 'em bought it.

So that was like 40 some odd people had 29 bucks.

So that was a good little like push initially. Plus I had all these blog posts and stuff talking about Learn Dash. WordPress, LMS, I mean, blogging and search engine results and stuff were a different place in 20 12,

20 13. Yeah so that really helped at the time.

And then from there, I was just relentless on improving the product and talking about my value proposition.

Like there were other competitors who kind of caught wind of this, that had way more money than me. Like, at the time it was Woo. Themes, which is acquired by automatic, became WooCommerce. They had a competing product and [00:12:00] they, it was very polished. Mine was a little bit rudimentary as I was getting going, but I was like, look, I don't have to beat them on all their product line.

I just have to beat this one product.

Know where your audience hangs out
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Justin Ferriman: My motto at the time was I wanted to be their Wendy's to their McDonald's. Because for in the eighties, Wendy's strategy was always to open a location across the street from McDonald's. So like anywhere they were mentioned at any blog post, I was always in the comments, I was writing, the authors asking to update the article

to include Learn dash really grassroots.

Brian: or in the mix in, in that like, category of, of products.

Justin Ferriman: Exactly.

Brian: it. I mean, yeah, so like two things kind of stick out to me there. One is, you know, going back to, you mentioned this a few times, literally just using the term LMS I, I could totally see, I sort of remember this, this era, uh uh, and probably still today, there's some truth to this where it's like

especially in the WordPress space where, okay, they, there's a lot of people thinking that they're building a, a member, a quote unquote membership tool or like a [00:13:00] forms tool or, something like that. But they're not actually mapping it to the terminology and the job to be done that the customer is thinking about.

Like, customers are not thinking about like, pages from access of login. They're, they're thinking about like . Delivering a course to my clients or delivering a course to my students, you know? Um, so Yeah, like really speaking that, that language and that just, you know, you, you're, you're in that space.

You're, you're in that market. You, you know how those customers think and, and speak, you know?

Justin Ferriman: Exactly. Yeah. And the, the whole WordPress LMS piece, I remember looking at the time, there was like 200 searches a month maybe for that term when I was targeting it. And that literally, I know that I was gonna create this huge segment because then everybody started calling it a WordPress LMS. And now it's, as you mentioned, I mean there's countless options and then SaaS options and I mean, you can So you just throw a stone and you're gonna hit some kind of software that allows you to create and sell courses.

Pricing *gasp* before subscriptions
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Brian: How did, so how did pricing work? Because I, I know also during that period probably across most WordPress products, [00:14:00] there was like this big transition from the traditional WordPress plugin pricing to more of like a ified approach to, to WordPress products. Did, did LearnDash go through that same

Justin Ferriman: yeah, yeah, definitely. In the beginning it was just, you bought it once. There's no renewals or anything, and that sounds crazy today, but that's just what it was at the time. For WordPress, it was actually woo themes that changed that for everybody. They started implementing a renewal

and then you would get like a discount on the renewal.

I mean, it was very very soft the way that they did it.

But in the beginning, yeah, it was buy it once and you had it forever and What's interesting about that is when I sold the business and I was doing my management presentations, and I did a lot of 'em, everybody wanted me to quantify the loss of future revenue based on those lifetime purchases, which was nothing.

And I just, I explained that because it was only the first year, maybe year and a half, maybe two years max, where that was happening.

And it was still [00:15:00] at like a lifestyle business stage for me at that point. But People. Yeah. People care, investors care. Obviously

if, if there's gonna be loss of future revenue with that.

Growing the LearnDash team
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Brian: Hmm. Um, How about like the, the team, how did that grow over, the years that you're running it?

Justin Ferriman: Yeah. So the team

was contractor

Brian: a solo

Justin Ferriman: long time. Yeah. So the team was contractors. It was me finding contractors. I did support because I was, I, I could do that. I knew WordPress, I was savvy enough to kind of figure things out. If it was too technical, I sent it to the dev that I contracted and that was the case for a while.

I mean, the first year of LearnDash did about 200 k and I was, I mean, it might as well have been 200 million. In my mind is that was like amazing. I didn't have to work at that other job. I was at home. I wasn't working as much. anD support was reasonable. , I mean, it was just me and you know, like a contractor for handling it

as time went on. Every, [00:16:00] it started catching wind being adopted by some influencers at the time, and like the internet marketing space. And people wanted to know what's your tech stack? And so LearnDash was there and so it got more popular and needed more help. By the time I exited, it was roughly 40 employees. So

the

Brian: were all, all remote through

Justin Ferriman: everybody was

remote. Yeah. And by that time we had a mix of contractors and, and full-time employees and all over the world. Mostly in the US but you know, north America, in general, central America, south America, Asia, Europe we were all over the place.

Biggest challenges growing LearnDash
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Brian: Amazing. Um, I mean, I want to get into like the, the exit and the transition and everything, but like, how about like the later stage of that business? Like what were some of the biggest challenges maybe overall in the business, but. Yeah, like, like obviously it, it was a great business. It was profitable, it was growing

Justin Ferriman: Mm-Hmm.

Brian: a great market at, with, with great product market fit and great timing.

What were the biggest challenges for you? Looking back on that, [00:17:00] on that period,

Justin Ferriman: Well, in WordPress in general,

support is always the biggest challenge. Anybody my friends or network or people I coach that are in the space, like support is more of an investment and cost and more thinking around it than a SaaS traditionally, because there's so many factors you can't control. Everybody's self-hosting their site with different plugins. The, the anger some people would experience when something wouldn't go right. I mean, it was just a constant that that wore me out, I think, more than I thought. Eventually I got outta support, obviously, and thankfully, and had people way better than me managing it and had a team there. But that was always a challenge.

But the other part from a marketing business standpoint was all these SaaS platforms getting in the space. You know, at the time, teachable, teachable came a route right around the same time as LearnDash. In fact, at one point, teachable did a huge marketing campaign targeting LearnDash users. And I remember it was called Kaja, or not Kajabi, it was called Kajabi's.

Great. I like that tool. It was a fedora at the time. [00:18:00] And the SaaS platforms saw the opportunity and they had a good system, right? And they kept things basic where I always tried to go more advanced in, in the features because that's what I was used to. You know, quizzing is more than multiple choice.

You have to have all these different types of quiz questions and It was, we were kind of starting to lag behind in 2018 in terms of the market. There were SaaS platforms. People were going to other WordPress plugins now that had jumped in, which their advantage is they could see what was working and then make it a little bit better, or like modify how they presented it because the template was there for them. So in 2019, did a huge version 3.0 rewrite. It took forever. It was a huge challenge. And what I did is I actually brought in one of the more well-known firms in WordPress to help With this project. So I hired them. And then we had our own team, and then I hired a design firm. So I had three I guess, parties working on this. And that was a, a big challenge because I think people were starting to see LearnDash's [00:19:00] stale. But after that release, it just catapulted the product. I mean, the sales went up 22% and stayed up after like nothing else changed. it

was just, just the product changed.

Brian: It was like literally like a, after that big effort on the product, like, like the, the product was like, just like that much better, easier to use, more like more important features. And, and the kind of like used it and then talked about it. Is that what really gr like

Justin Ferriman: it, it really, yeah, it was, and like the hype machine that I created behind it, and it was cool. It, it, we had this joke. It was like, all right, let's start the clock and see how many people start copying us, and that eventually happens. 'cause to compete on features is always gonna be a temporary win.

Everybody can create, you know, the same features.

So you gotta find other ways to, to position yourself. And we always positioned ourselves as, hey, like I came from e-learning. I understand online learning. These, these folks are just developers. They're not from the space. We have more intent with what we're doing in the features that we add. And I think that [00:20:00] resonated with folks that were serious about their online courses.

Justin's LearnDash exit
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Brian: Yeah. Very cool. So how did the exit start? You know, the idea of selling the business? How did, like where did the, the, the initial. Start of that happened, like, I I'm sure you know LearnDash probably like most other big, well-known WordPress companies are getting offers all the time and, and

and that sort of stuff.

But yeah, like, like for you, like when was the first moment of like, I actually, I might start to look into this or consider this as an option. I.

Justin Ferriman: I started seriously fielding inquiries, like having some conversations in 2019. But nothing really. I still felt like I had more in me. It was off the heels of the big release, so I was kind of energized. But I was getting worn out and I knew that it wouldn't last forever. I've been fortunate in my career, whether it's luck, maybe some gut intuition to, to have a good sense of timing and when, when Covid hit and the pandemic came about, [00:21:00] I. It changed the business. Everybody was at home creating online courses. So I think in two months I hired 15 people.

I was, I was worn out. Every, like, everybody was busting their butts that we're on the team working harder later supporting people. 'cause we just had this huge influx. I mean, that went on and on and on for a couple years.

And so during that time, and this was in 2020. I, somebody just kind of said like, Hey, if you want me to make an introduction to some investment banking firm, I know the, the owner of it. I'll make the introduction to you. And I was like, all right. So I had the meeting with them. I kind of at a high level shared the financials, kind of where things were at, and he was like, wow, like you could do really well if you want to exit contemplating where things were at the market.

There was a lot of uncertainty around the covid. I felt like, you know, now's the time. To, I mean, it's still growing and it's, it's exploding, so I might as well have tried doing it now. [00:22:00] That process started October, 2020 and sold September, 2021, so it's almost a year. And I learned a lot. It was, I, I wouldn't want to do it again, but I, I know a lot more about how that goes from a very formal process of investment bankers and putting out Lois and doing like four hour management presentations and just like that whole game That's it's it's something else. But yeah, sold September, 2021. I was on contract for like a year for four months. I had to be like, very involved and then I was kind of like on call for a little bit.

Brian: Okay. Yeah. Very cool. I, I also sold in 2021 Audience Ops. And a couple other smaller projects well. And, and yeah, that time, I mean, I'm sure it was a much crazier trajectory for you and, and much larger deal of course. And everything. But like the I also felt like, I like looking back on that, like the decision to sell that year I think was good.

Like

Justin Ferriman: Yeah,

Brian: it was and it was one of the like, like [00:23:00] there's just like an an an overall sellers market I think going Um, And, and for me it was also like I was holding that business for a few years thinking like, I'm happy to hold it, but I'm, but I think I'll exit it at some point. It's just a question of when, and that year just seemed to kind of click.

Justin Ferriman: It, it really was. And I think it was like it was a seller's market, but like these, if, if folks had the money they were trying to snap up what they could. I mean, there

was like, I say this not in a negative way. 'cause I think this term gets Seen as negative, but there was like greed all around, right?

Like there was people that were, and people were making money, left both sides of the aisle.

So like it was a hot time to sell and to invest and to, you know, grow. Four months had, so that was September. If it had been in like January, 2022, I wouldn't have gotten as much money for the business.

A hundred percent. it's just

timing. , I dunno. I got it's lucky sometimes.

Brian: Yeah, yeah, for sure. And it is a whole tricky [00:24:00] process going through it and I mean emotionally and, and, and all that. I. I mean aside, like I know that like just the whole process of like actually selling and going through due diligence and, and getting to close, and then probably even afterward, like the, that's all consuming in itself.

Right.

Justin Ferriman: Yeah.

After the exit: What next?
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Brian: I'm curious to know, like did it, were you even thinking about what your next chapter would, I'm talking about like before you sell or like, you know, like the sale is in the process of happening. Maybe it's not a done deal yet, but you have to start to consider, or you don't have to, but like you're, are, are you thinking at all about like, all right, if I sell, then what, what am I going to do with my life and my career afterward?

Or, or was it more like, let's just get this done and then take, take a break and I'll figure it out later?

Justin Ferriman: Mm. It's probably more what you were initially said. I think it's human nature to be like, oh, what am I gonna do next? And. I, you know, like I didn't have experience with that. So [00:25:00] as we'll get to, like, I think I made some errors in, in, that by moving too quick and not really understanding what it is I wanted to do. I dabbled with some things, podcasting, which you're exceptional at, but I dabbled in that and I, I found like, ah, you know, maybe that's not for me. Or I just wasn't passionate and so

Brian: You mean like, like do like hosting a podcast?

Justin Ferriman: Yeah. Yeah. And then I was like, you know, how many more like. There's plenty of podcasts on the themes that I was talking

about, so then people would do it better.

So I was like, I don't know if I'm adding any value. Um, It was, it was a lot of self discovery. I actually was thinking about e-learning space still, but, but then I'm not allowed to

'cause of a non-compete. So, so

that was like, I was like, oh dang, I can't do that. And then You, you read all the time about people that have exits and suddenly they become investors and they're like working with other startups and they're creating incubators and all this stuff.

And I think on the surface that sounds pretty cool, but I, I just, I was like, oh, maybe I'll do that. But the more I thought about, I was like, you know, [00:26:00] like it doesn't really get me excited. Like, I don't, I don't care about that.

I, I don't know why that is, like the You know, the blessed path that it seems like everybody says you have to do.

Maybe I felt like I should do it because that's what people do after they sell. buT I, you know, that's

not

Brian: you're more interested in building something new, making something.

Justin Ferriman: at the time, yeah, I was like maybe making something new. I thought software and that's what led me to the Gap Scout,

which was an AI tool I was creating based on a process I did manually with LearnDash.

So Gapc Scout in a sentence. It would look at your software and compare all the reviews that are out there on like every site, review site or the major ones, and give you, using ai, the themes of where you're doing well, what's you're not doing well, what's the overall sentiment, where are the gaps in the market, hence the name. And then also your competitors and comparing your reviews to your competitors' reviews and doing like a big data analysis with like all these comments and, and timing of the comments and all this stuff. It was really cool. [00:27:00] It was a struggle. I, I think what I,

Brian: that

Justin Ferriman: yeah. Okay. I'm happy to, because I learned a lot

Brian: I mean, so. First of all, I, when you, and I remember when you initially announced Gap Scout as like this new idea, kind of like your next thing. And I was, I was pretty excited about it because at, at the time I was also pretty heavily into market research and customer research with, my SaaS. I was like that this tool is tackling a lot of the processes that I am actually doing.

So this is super interesting and I felt like you were onto something.

Justin Ferriman: Yeah.

Brian: I was also that, that's also where I started to follow you a bit more. 'cause you, you started to embrace the whole build in public thing, which I, I love that whole

Justin Ferriman: Yeah.

Brian: Always, always interested to see what especially folks like you, like, you know, kind of hacking away on, on some early, early stage ideas.

what I'm curious to know, like aside from the pro like gap scout itself, like the, the decision to even do a SaaS. [00:28:00] Like were you, were you in some sort of like decision mode where you were like, okay, of all the product types out there or business types out there, I think I wanna do software again and let's go after SaaS and like what was your process of like coming to that idea?

I.

Justin Ferriman: I think so at that time I was coming off of the obligation for selling LearnDash and maybe I was feeling like this intrinsic pressure to like do something. I think there's this unsettledness and not having a definition of like what you do in people. So I was thinking, and I was certainly experiencing it, so I was thinking like, what, what can I do well?

What am I good at? Well, software and I just kind of defaulted, I think, to what was easy. I was like, yeah, software, I'm good at that. I enjoy building brands. Like I enjoy marketing and positioning. Like that's, that's my joy out of software. It's not the tech.

I chose a SaaS because I knew the headaches of supporting WordPress, and I was like, I don't wanna do that anymore or be involved with that. [00:29:00] obviously the grass isn't always greener as I learned, but the, you know, that was kind of like the high level thinking and I was like, all right, I'm just gonna spin up a website. I'm gonna start blogging, getting content, really got a machine going. Same process I did for LearnDash. I mean, even to this day, there's thousands of people on the email list for gap scout and unfortunately nothing's gonna come of it. But that was my, that was the part I enjoyed. I kept running into roadblocks and hurdles with the tech Around ai that got like, I had to get lawyers involved because a lot of these sites were changing their terms and conditions as like chat GT and AI and all that became more prevalent. They

created real,

Brian: the other interesting thing about Gapc Scout is that you, you started working on that idea, like that was before chat. GPT kind of hit the scene, right? Like that was

Justin Ferriman: was, yeah.

Brian: you know, so you were not before ai, of course, but like before the, this most recent wave of, of ai, you know.

AI and it's implications on software dev
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Justin Ferriman: Yeah, it was. I know it was. And then the AI piece came in, or ChatGPT came in, open AI and that revolutionized and changed things. And then [00:30:00] admittedly pivoted a little because I was like, how can we incorporate some of this? And the way it was gonna work, I had two ai, I had open ai, and then another one that was more related to sentiment analysis, and that was

Being ported into the dashboard.

And I had hired an agency to do this and they're great. It just was such a, I felt like the goalposts were constantly moving.

And then I had chosen, this was just bad luck. Chose one of those ais that I was gonna be using. They were bought out and then that new company shut it down.

So had to start rebuilding with a different option, which was a nightmare. Yeah. And so as these things were happening though, like I was like, why? I kept saying, I was saying to my wife, I was like, why, why am I doing this? Like, I hate this, I hate this part of it. And I just wasn't listening to myself.

I liked The, marketing tech Yeah. I was like, someone else should be worrying about this, not me. I can speak the language kind of, but like, I don't know. And the, you know what Brian, the tipping point was for me I received a letter from G2, [00:31:00] which is where some reviews are, and they're like, you can't do what you're gonna do.

And if you do, we're gonna take you to court. So

I contacted my legal personnel and I was just like, Hey can you review this? And like, can we have a conversation? They did some digging. They

had some similar cases in the past. Go ahead.

Brian: so just like, like they, they had issue with what, like scraping their, their stuff

Justin Ferriman: Yeah. S yeah, I guess I mean it in. So Yeah. To using their reviews that are super public

Brian: on the internet, like

Justin Ferriman: Yeah. bUt the lawyers, they're like, man, I know this sounds crazy, but they have a case. Like you can't, if you look at their terms and conditions, it's like super draconian and the way they are, like you, you technically cannot be a consultant and say, Hey, client, I'm gonna go to the site.

I'm gonna take these reviews, put it in Excel, analyze it myself. Get some insights and share it in a report that I create for you. Like all manual, no [00:32:00] software,

nothing.

Brian: and like private, like not even like public. Publishing their reviews

Justin Ferriman: Exactly. Private. Can't do it.

They have grounds to take you to court. Now, will they in that case, no.

That's my lawyer was just like, look, it's a judgment call on the risk, right?

That there's like zero risk there. I mean, maybe 0.01%, but In your case, you have a lot more risk because you're profiting from something that they've really tried to lock down. And what I've noticed is these sites, Capterra, G2, et cetera, have a, started adding AI clauses to their data. They're saying you cannot analyze or gain insights from our data using AI even though it's public, not gated by anything. And their, their solution

is you pay them a yearly license.

Brian: I was gonna say it was like that, that's part of their product that they sell. Is is

Justin Ferriman: Exactly. And if you think about it, you know, they have to create a moat. They have tons of investors and they don't want to see the world changing and their money value going down.

So[00:33:00]

Brian: And you're right,

Justin Ferriman: when I pull the plug.

Brian: risk thing. It's like even, even if like, obviously you could technically pull it off, or even if you're just a small agency and you have people manually, you know, analyzing their, their reviews, like technically that's easy to do.

Justin Ferriman: Mm-Hmm.

Brian: and you could build a whole business on that.

But it's the risk of, you know, me and. In all likelihood, they, they would maybe not even ever like sue you over that. But if you were to ever sell this business, that almost makes it like unsellable, right? Because it's like there's this massive , the, the whole business, the, the underpinning of the whole thing is built on this like risky proposition, you know?

Justin Ferriman: Yeah, that was so, it was so deflating and frustrating,

like, as you can imagine, and. I tried to say like, okay, how could we pivot it? Like just to kind of how you were alluding to like what if you did something internal and is more of like an agency and we were like, I don't know, like less of a SaaS but more some of our own tool. And even still there was risk there. And at this point in my entrepreneurial [00:34:00] career, like I don't need to be so risky. I don't want to be so

risky. And. I wasn't enjoying the process. I didn't suddenly my whole pricing structure would have to change because of the licensing fees I owe these businesses and now these businesses can change their terms, increase the price, do whatever they want.

Like, I'm so dependent on them that I pulled the plug. I had the software, software works. we, I was weeks away from a launch and I said, no, can't do it.

Brian: I I had no idea. Like from a, you know, someone kind of following you from afar. I had no idea you had all those like, kind of technical legal challenges with it. But

Justin Ferriman: Yeah, . That was one thing I didn't put in public too much 'cause I was like, I don't, I don't know legally if I wanna put this out there, but I tried the, the build in public thing was I. It was a good, it was more I'd never done it, so I'm glad that you found some of the things that insightful are useful.

I did create competitors from it. I had somebody who's just a solo dev release something before I did with a lot of the same value proposition I did. His, his product is pretty [00:35:00] crappy, but he got acquired. He actually got acquired by another firm. I think it was more of like an AccuHire, you know, they just took his product, hired him as Dev and

Brian: What I was curious about, like. Because I, I really had no idea about all those complications with it, but I, I was kind of curious about like what, what your experience was with, you know, taking a new purely SaaS idea to market compared to operating in the WordPress space. Like, were there other challenges with like, um, this not being, not benefiting from like the WordPress ecosystem?

Justin Ferriman: Yeah. Well, the WordPress ecosystem is just that, that's very supportive and interested in new products, you know, shiny new objects coming out. Had I been in the WordPress space, and I should mention that my product was gonna work for WordPress, that was something unique I put in, was that you could look at WordPress reviews on like the WordPress repository word plugins and stuff are.

So, I was still gonna honor my roots and like really help those folks out in a way that, you know, I would've liked to [00:36:00] have if I was still running LearnDash. But if I was in WordPress, I would've had this ecosystem. I obviously would've had the connections to maybe amplify the messaging maybe take advantage of my previous success more directly.

In terms of the marketing and how I went about it I was okay with not having that, though. I wanted a new challenge at the time, and SaaS seemed like the way to go. ai. You know, it was kind of right before the explosion of it, but I thought that was cool and obviously it's the future and we're kind of there now.

But yeah, I think if I were to do,

Brian: in your shoes, you're, you're coming off this, you know, hugely like successful exit like . You don't need this business to work, and you don't need this business to be super hard. , you know,

Justin Ferriman: Yeah. Yeah.