Growing a newsletter business
===

Brian: [00:00:00] You're about to hear my conversation with Dru Riley. He is the founder of trends. vc. We're going to talk all about building a newsletter based business.

Let's get into it.

So I'M about to roll my conversation with Dru Riley, the founder of trends. vc. It's a fantastic business. He's been running it and building it for several years. It's all built around a newsletter, which then leads into a pro membership and sponsorships and all sorts of other revenue channels. So we get into all the nuts and bolts and the incredible amount of systems that Dru has been able to build, to run and grow this business. It's really good chat. Here it is. Here's my conversation with Dru. Enjoy.

Brian: Dru Riley great to connect with You again Great to finally, Get you on the podcast We've been trying to do this for, for a while but yeah, glad we made it happen.

Dru : Indeed. Thanks for the invite. Excited for this.

Brian: Yeah.[00:01:00] I hope I sound okay. I'm, I'm like in the middle of my office which is going through a major refresh, and right now. I have like no furniture in it except for this one desk. So everything's like super echoey and I gotta get it all figured out. But hopefully it'll, it'll happen.

Dru : Yeah, yeah. You're coming in clear to me.

Newsletter + Community
---

Brian: All right, cool. So, you know, I've been super impressed. with what you've built with with trends, VVC trends, VC for the last several years. I want to kind of get the story on that. And, you know, one thing that I I think about w when I, when I follow your stuff, is like, how, how systematic, uh, your businesses are I, think, I think you're, probably like that too. I definitely relate to that, but I feel like. It really comes through in, in your work and the output. And you can just see it in the, in the weekly reports and everything that, that you do with trends. So, I want to kind of understand how this, how this business kind of operates. I think it's super fascinating.

Dru : Yeah. Yeah. So a little

Brian: like how do you describe it today? Like, [00:02:00] we'll, we'll go back. in the story, but like what, what do you describe as like trends today?

Dru : Yeah, I would still say trends is a newsletter with a community component. It started as a newsletter first, uh, focused on founders and helping them discover new markets and ideas. So the earliest content type that we had are these reports, which you just talked about, and the format has evolved over time.

But the core of it is we try to, you know, find the core problem that . Sort of market solver, like what's the core problem that's solved by no code or micro SaaS apps. And we try to do that without making any comparisons to something else, because that's not really first principles thinking solution.

Who are the key players in that space? And then we go on to, you know, try to find some opportunities, make some predictions, uh, there, uh,

Brian: I, I mean, my understanding is like, it it, like you guys really break down every single like. Buzzword, if you will. That's probably the wrong term for it, but like any kind of like [00:03:00] subcategory or sub sub niche category in the tech world. you have produced a trends report on that thing. Like I, I know you've, you've featured my stuff in like productized services before.

You've, you, you've done like micro. sas, you've done, like, I'm sure you've done a ton on like AI and like, you know, like, and like hundreds of other subtopics that you might point to. And it's like everything that you need to. know about, if you're sort of exploring this as, I'm, I'm curious to know like, who do you, who are the subscribers or who are the, customers of this? Is it people who are like looking for a new a, a next business idea. Is it investors? Is it some people who are just interested, like probably a mix of everything or

Dru : Yeah. Yeah. So maybe the, the audience is split skewed maybe 60 to 70% of people that have . Existing businesses as pro members that are sort of looking at, okay, what does AI generated content mean for us? Or how do I take advantage of this within my current [00:04:00] business? And then it's probably skewed the other way, maybe even more so with free subscribers of people looking for their next business idea.

So it, it skews in one direction or another. And then of course we do have some investors, people that have holding companies or running a search fund. I. But I wouldn't say that the majority of the audience are investors.

Breakdown of revenue channels
---

Brian: Got it. Yeah. And I, I wanted to kind of get a breakdown of like your different revenue. I, I guess that's my, my next question here is like, so how do you, I, I see the PRO membership, I see sponsorships on the newsletter. Are, are there other. Pieces of the pie, if you will, on revenue.

Dru : Yeah. Yeah. So number one for us is around subscription revenue from pro members. That would be the main source of revenue. Secondary sponsorships something that's emerging right now. You have this newsletter, co-registration trend where Spark loop, but you also have beehive with their boost programs.

That's becoming a more substantial part of revenue [00:05:00] as well. We also have

Brian: like people, A actually I just, I've been on your newsletter forever, but I just went through it as a, as like a fake subscriber today to experience it again. And I noticed that that popped up. So I signed up and then, and then I saw like the spark loop thing where it recommends like three other newsletters. So you guys actually earn like a commission if, if someone subscribes to those.

Dru : Yeah. And there are just to over-communicate free versions of that. So ConvertKit, before they rolled out their paid program, they had a creator network where it was just this sort of unofficial, I like Brian's stuff, so I'm gonna refer him for free. But we use the spark loop implementation of that, which those are like paid recommendations for us.

And then other revenue. We've dabbled with affiliate revenue. In the past. We don't have anything going right now, but sometimes, uh, let's say we don't have a sponsor for a given week, we'll give that sponsorship slot to an affiliate company, for example, and that sort of pay per, [00:06:00] per pay for performance type revenue there.

And then we also have an ebook, the essentials ebook, where we take and we re-release it quarterly. The most popular or most useful this is subjective trends, pro Reports package that up into an ebook and sell that as well.

Brian: Oh, okay. Where do you actually, sell the ebook? Is that like through your own site or

Dru : mm-Hmm. it's best Trends vc.

Brian: oh nice. Oh, very cool. .

And then like, what does, it look like Do you share like. subscriber numbers or any, anything like that publicly or

Dru : yeah, yeah, yeah. You it's not completely up to date. We should make it real time at some point, but we have, I think, 63 or 64,000 free subscribers and about 1400 pro members,

Brian: nice, nice. So what does your what does your team look like at this point?

Dru : Very, very lean. So, since it's so small, we have people playing multiple roles. We have ilis who runs operations, so any email scheduling, mastermind rotation. Support, things like that. He runs. And then we have Emin, [00:07:00] who's our editor slash analyst slash marketer. And then me, I still do a little bit of like, no code automation on the side.

A lot of editing also marketing things launching new projects. We're working on a YouTube channel right now, so yeah. Everybody's playing multiple roles.

Launching a podcast for Trends.vc
---

Brian: yeah. Yeah. I, I did see that you guys recently launched a podcast and, and YouTube. Is that like one and the same?

Dru : Yeah, so this is a very, very interesting conversation because something that I just came to terms with is, I guess the ideal for us is for us to release the podcast in a way where the audio could serve double duty and become like the script for videos. But it seems, it seems like if you want to like

Boost the chances of success for one platform, then you need to think about that platform from first principles, right? So we may give up some upside by trying to over, not over-engineer, but make this one piece of content. Serve multiple roles, and do the job to be done [00:08:00] for multiple platforms, right?

Think about podcasts from first principles. Think about YouTube from first principles. So we're still going to try to repurpose that audio, but we have to try. But I'm not that optimistic.

Brian: You know that, that's

really

interesting. I'm, I'm going deep

on YouTube right

now.

I'm, I'm planning on kind of going hard on YouTube in the next couple weeks here

for the next while. And, And I do podcasting

and too, and, and

the way that I think about it is

exactly that. Like

YouTube

is,

is really its own thing,

Dru : mm-hmm.

Brian: you know?

and it's like. YouTube

is

a

platform,

where

you, you can get discovered and through their

algorithm

and, but

every video

has to be sort of optimized

for that

And,

and

then I think about the podcast much

more

like, like an email.

list,

which is like, that's like a relationship channel.

Like

after

you

find me

or discover my stuff

or

discover, you know, then, then you subscribe and now we go deep, long term, you know.

Dru : completely. Absolutely. And I think a good, I guess story to put a bow on that is some of the largest and most successful podcasts [00:09:00] in the world are like these remote interview shows, and that just does not work on YouTube. I think I may have found, I don't even know if I would call it an exception because it's not a success in terms of YouTube standards, but they had like a hundred or 200,000 subscribers.

But the in-person interview shows on YouTube do amazing.

Brian: Yeah.

Yeah,

that's

true. I mean,

what I'm doing with this, show, you know,

like

this will.

be released as like an Open Threads podcast episode on the podcast, but I'll probably cut. 10 minute segments. If we talk about one topic, like Dru and Brian talk about using YouTube in different ways like that, that'll be like a 10 minute segment that I could release on YouTube as, as like its own specific topic.

You know,

Dru : Quick question. Are you using any of these like opus clips or AI clipping tools or are you doing that manually where you take the clips?

Brian: Pretty minimal.

I mean,

right

now.

I'm,

I'm using

Riverside

to

record this, and then, this current run, like this podcast has been on hiatus for a year, so I'm kind of bringing it [00:10:00] back and starting the, the editing process all over again. In the past, we, you know, my editor has used like d script to

Manually,

cut things up and get them, get them up.

I mean,

Dru : mean,

Brian: we'll probably do

something

like that. Just, you know, I, I

still think that there is

value in a human like.

I don't care so much.

about like taking out the ums and the spaces and stuff, but somebody deciding like, oh, this minute to that minute is the most interesting piece. Let's cut that. Um, I know that there are, I think even Riverside has a tool now in, in it to like use the AI to find clips and cut them out, but haven't really played around with it yet. We'll see. So I

Pro membership model
---

Brian: wanna get back to like,

The structure of, of trends,

right, so one thing I didn't quite realize about.

the

PRO membership

Is

it's

really,

it looks like

it's really like a membership?

community.

I thought it was like more like access to exclusive content. [00:11:00] I guess

part of it is like you,

you get like the, the full reports or something like that, but like, it looks like there's a whole like,

interactive. community

in there.

Can

you talk about that?

Like

what, what's the experience for the members?

Dru : Yeah. That's something that I thought about a lot at first and there's, it should still be my pinned tweet on my profile, but just how I. We think about community design the importance of things like rituals. So one aspect of that community membership that doesn't apply to content.

We have daily standups, we have weekly masterminds, and even that's intentional, right? So, you could continue to go up layers of, we're thinking about a quarterly hackathon between members. And this is becoming a bit jumpy where I'm jumping between topics, but I agree with what you said about there's still being something to the manual or human element to picking those clips.

Something I realized we recently sent a one question survey out to members, and I've been using since we have like 150 replies back, you can do it manually, but I've been using Chatt PT to sort of get like, you know, some type of like, color of [00:12:00] the feedback or, you know, gimme the most important things back and it missed a lot of things.

And one of the things that people recognize to go back to community design. Was quarterly hackathons and

Dru : we also try to like, promote a lot of what the members are working on in the newsletter, sort of lending distribution to them. And that could be another idea, right? Where

Brian: I, I

could see that. Yeah,

that makes sense.

Dru : Yeah. This is like first, second, third place, but,

yeah. So that, and then it sort of creates this mini flywheel where we have things like fade finds in the community. So maybe you find a great, found, a great Chrome extension or a podcast episode that you enjoyed. We'll surface that through the Curated Newsletter, which is Founded Finds, which was started about a year and a half ago.

So, we try to build these like mini flywheels wherever we can, where one product reinforces the other product and so on.

Process and delegation
---

Brian: Yeah. All right. So I'm seeing these like incredibly detailed, like

Really, really high quality.

weekly

reports [00:13:00] that go out to the trends newsletter. I'm seeing this

Really high quality.

community and these, like you, you call 'em like these flywheels, like, you know, all these different kind of Activ community activities that's happening. If you're selling sponsorships, that that's a whole operation in, in itself, I'm sure. And now you're getting into like podcasts and, and video. How is all this stuff coming together and really coming together at such a high level? Like who is doing what, what does this operation look like? And I'm curious like, how much are you involved in, in all this stuff from the, like I, we can dig into each area, but like. So let's start with you, like your week to week activity, Monday to Friday. Like what are you actually have your hands in, in terms of like what gets produced?

Dru : So, so I have to sort of take a step back and talk about our process. Almost everything that's operations focused or Operation s facing. It exists as a workflow in the tool we use called process Street. You're very, very familiar [00:14:00] with like the benefits of this. Having built and run process kit.

So, that does a lot of the heavy lifting for us in terms of quality control and who owns what and when these things are due, and that kind of gives us predictability. So, the biggest workflow that we have is around how reports come together. And there may be like 110 steps in there, but it's very clear like who does, does what, when things are due.

And then we have even redundant steps where you can get into theory, like, three round revision systems for content, right? Just in case something was missed the first time or perhaps you wanted to push back on an editing note that was made in the first round. At some point I may do like a workshop on just how we think about processor system design.

But I'll say I'm involved in that process. I'm involved in the maybe 40 or 50 step process of how founder finds come together. We have processes around mastermind placement and who will be the host that particular week. I'm trying to think of a process where I might not be involved in it.[00:15:00] Maybe if there's like a support task where we have tier one and tier two support.

If something doesn't need to go to tier two, then it just doesn't. So maybe there are like one day out of the week or two days out of the week where something needs to be escalated just because it's a, a novel issue or a new issue. But yeah.

Brian: guess what I'm wondering is like when you say like you're involved, 'cause like there's gotta be

a lot of

those steps

that involve creativity,

Dru : Mm-Hmm.

Brian: or like making like sort of strategic decisions or analytical decisions. Is your team like empowered with. Like creating stuff or deciding on the, on the content of a newsletter? Or is that still like going to you to like, make like the creative direction on, on things?

Dru : No. When it comes to reports, I will give the analysts or analysts options, like two or three options to pick from, and then they pick from like whatever they're most interested in, because I think that will lead to the better quality report If you're genuinely interested in something. But even when it comes to founder finds [00:16:00] editorials for the first several weeks.

I wrote the editorials out. The way that goes is that our analysts will throw up, like share these links of, this is a great podcast episode, this is a cool essay. This is a cool talk from YouTube. And I'll sort of strike out the things that I don't see that are that interesting. And then he'll take that and he'll expound on it.

And if you see the sort of editorial that we will add as sort of context or wrapper. To these elements. He'll do that. And the process is so smooth when it comes to reports and then when it comes to editorials, yeah, we have three rounds of revisions, but we probably only need one at this point. But as we're bringing in more analysts, I'm sure until we sort of sync on taste, we need all three of those rounds.

Brian: Yeah, it's fascinating. I, this seems like one of the hardest businesses to build a really good process and team around,

but like,

it's clear that you've, you've done it, like there's some secret sauce happening in there between the process design and, and

the Hiring.

practices.

Dru : [00:17:00] Yeah, on the hiring practices front it took a long, long time to sort of, and I don't think we've completely nailed it, but it's night and day from what it was before. We lean a lot on test tasks. Because I feel like, and I don't want this to be taken negatively, but there are a lot of people that sort of talk a good game and they can interview very well.

But when it comes to sort of quality of work, either it's there and it's not consistent or it's just not there in the first place. So,

Brian: I,

I've definitely experienced that in so many different. Roles, I'm sure most people have where it's like you could have the great, the the best feeling about someone during the hiring process, but if you don't really know until you start working with them. Yeah.

Dru : Yeah, so we stress test that a lot where your application is 90% like a very, you know, short test test. And then we follow that up with a paid test task and we're really sort of trying to stress test that ability where the application process is harder than the job is itself, but we, we really want to be careful there.

Choosing the right topics
---

Brian: One of the

you know,

[00:18:00]

Brian: actually

getting back to YouTube a little bit, like in, in a lot of my research and planning on this, it, it seems like topic selection, initial topic selection really is everything. Like you can optimize the, the production process and the, the way that you shoot, the way that you edit.

Dru : But

Brian: if, if you

are not nailing the right topics

that resonate with the market

at the right

time,

nothing else really matters. And I, and I'm

curious to know. You guys have been at this for years now with, with putting out these weekly reports and there's so many of, I'm sure you've like sort of gone back and covered different topics multiple times,

but like how do you.

decide on, or like prioritize topics and put them into a calendar and what rises to the top?

Like what are sort of like the metrics or the keyword research or audience research that you do to like to, to nail down like, we should be covering this and that topic. Sometime in the next month or two.

Dru : Yeah, so it just comes from filling, and this is a part that isn't as [00:19:00] scientific as, Hey, this person shared this resource in FA finds in the community, so we're gonna surface that. This is more of a benefit of being involved in multiple masterminds each week, or just looking at people's standups updates, like what are they exploring?

What could they benefit from topic wise? And that often drives which topics I provide to analysts in terms of these would be good to cover just because like boots on the ground, ear to the streets, this is what people are struggling with, or this is where their mind is at. So if we can save them 10 or 15 hours and like just help them quickly download like, what's going on in this space?

What matters, what doesn't matter? Who are the key players? Where do we think this is going with evidence-based predictions with like early examples. Then I try to do that. We've tried the keyword research approach, but you sort of end up in this space where, how do I put this? It just doesn't yield interesting results like.

You have like huge companies with great SEO, HubSpot [00:20:00] and so on where they're targeting these keywords, but it's like, maybe that was a good topic like a year and a half ago, but

Brian: I was gonna say, yeah.

like

you're, you're literally in the business of predicting trends, so like seeing reports on what. What is surfacing on like keyword research or traffic data, that, that's gotta be like, behind the trend.

You're,

you're more like ear to the ground. Like this is what people are actually talking about and Yeah.

Makes,

makes a ton of sense.

Dru : Trying to think about some other things.

Brian: and it, and it, again, it makes so much sense to have the pro membership like that. I feel like that's why this model works so well for you guys is that like you can literally like spin out topics from what people are talking about. And then it feeds that, that like front of house, like the, the top of funnel

report kind

of thing.

I

Dru : And it's interesting because there's this conflict between. I've, I've put on this hat of like, what would sponsors be interested in because we do do sponsorship outreach and outbound, and there are certain topics that we can say with a high degree of confidence, we'll be able to found a sponsor [00:21:00] for this topic.

But looking back, even before we started accepting sponsors and before we started doing outreach, some of our most popular topics would not have gotten a sponsor. Million dollar one person businesses is one. I'm trying to think of another one, but it's like there's no . You know, top of mind mapping to, oh, this would be a great sponsor, or this would be like a great category of sponsors to go after.

But

people

love this topic, so I, I, I don't wanna fall into that because if we had that hat on, or we used that model to pick topics before some of our best reports wouldn't have come out.

Marketing funnel
---

Brian: Hmm. Super interesting. I want to cover like,

you know, just

marketing. Like what, what?

does

your funnel look like in terms of how

are people

Dru : people

Brian: discovering you?

Again, I,

I think it's really worth, first of all, you should

just get on the list anyway 'cause

it's a really high quality newsletter.

But

I was really

fascinated today with

just seeing how,

like, how the funnel works on the

website,

from

when you put the email in, you get the Spark loop suggestions, and then

Brian: you

don't even see

[00:22:00] the

pro membership anywhere on the public site until you are an email subscriber. That was interesting, but

how do, how are people like.

actually discovering trends initially? What. You know, where are people finding you?

Dru : Yeah, so in the past it's, I'll say the majority of our subscribers have come from product hunt launches, which is good and bad. It's good because it happens to be this sort of tent pole event that we've been good at, the sort of designing product hunt launches and getting a lot of traction and product of the day, product of the week, product of the month, but it's

bad.

Brian: what

launch, what's like the launch that's repeated?

Dru : So the first launch was just trends vc, the newsletter itself. Then we had Trends vc, I think 2.0. I don't remember which order they came in, but this was after the community was added. The first time around, there was no community. And then we launched Founder Finds as its own product after that content type was released.

And just recently last week, we launched the podcast itself as a standalone product. . [00:23:00] The bad thing with this is that it's not sort of repeatable, where if you have someone where it's like, okay, our main driver is SEO, like that's a process that you can repeat, and that's where we thrive at. And then product Hunt.

I don't know if they've changed this, but the last time I checked you can only do a launch once every six months.

So,

But that's been the biggest source. Second I would say Twitter, and this goes back to what you said about discovery versus relationship platforms, and that's also why we're very interested in YouTube because one thing I heard about YouTube is it's not only a discovery platform in the way that Twitter is.

I suspect because you're adding audio and video as well, that the fed fin affinity that those viewers have for your brand is much higher than you would expect from a Twitter, for example,

Brian: I,

you know, Twitter, is another one.

that

I'm also doing a lot of research on right now because it's, I dunno about you, but Twitter is like my, my one like go-to place,

to like,

basically like hang out and use a social network. I, I never [00:24:00] touch Facebook and

I'm sort of getting into threads

a little bit, but, and I never touch LinkedIn. But Twitter is sort of like where?

our

people are, you know,

​

Brian: and, but

I.

do want to become a little bit more strategic without being. Without, I don't know, without having that, that like formulaic kind of thread boy thing going on, you know? I, I could see that, that you put out like, like really like high quality versions of your reports as like Twitter threads, but I'm curious to know, like, how do you think about that like balance between using Twitter as a platform to grow your audience versus using Twitter to just connect with, with people personally, like in our industry.

Dru : Yeah. This is a battle that I'm fighting right now where a few weeks ago I took Justin Welsh's, is it Twitter OSS course

Brian: I, I

just took that myself too.

Dru : Yeah. Yeah. And he sort of talks about the, the formulaic [00:25:00] approach, which a lot of people criticize. But it's interesting the way reviews can land with different people, because as you talked about, like, systems are so fundamental to the way we do things.

I'm like, that sounds great, let's do it. But you're also right in that if you sort of fall, fall into that category, there's no, to go back to Affinity, like I don't, I don't feel like I know who Brian is and I want to know who you are in addition to everything that you're doing. So,

Brian: yeah.

Dru : This, this seems very Go ahead.

Yeah.

Brian: yeah, I, I, I completely agree. You know, it's so funny, like I, I took Justin's course and I'm like so psyched about like all the, the content

oss, you know, like it's, it's a whole system that I could, I could deploy next year, you know, but then at, at the same time, it's like I still go on Twitter to, to just say random stuff or, or re reply back to people.

And I guess the way that I'm starting to think about it more though is that like

this podcast,

and my other one, bootstrapped web is. Is like the real conversation, like If, if you

know, me and follow me, then,

[00:26:00] then you're probably

on

this

feed and my newsletter.

​

Brian: and

Twitter.

it'll probably

just

be a mix of, of like quote unquote real tweets and like

Brian: pre-written, pre-scheduled content. But

Dru : but

Brian: I

haven't really gotten into that

yet,

but I, I think I will.

But trying to keep it. Trying to keep

The quality level.

high.

Like, I'm not gonna just publish garbage,

you know? But I, I feel like that's just sort of like the, at the, at the end of the day, like, I, I am running a business and going forward, I'm, I am more interested in growing the audience and if that's where the people are, you know,

Dru : yeah, yeah. And it works.

Brian: you know, you, this is,

You know, again,

you, you've,

you've built

a pretty incredible

business

here.

I

I, I'm always fascinated and really impressed with with the stuff that you build, with, with trends. I'm gonna keep keep Paul it along.

Thanks for, Thanks.

for doing it.

Dru : Thanks for checking it out. [00:27:00]

​