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🧠 100k users with a niche startup
How this founder built a niche startup using YouTube influencer marketing
Charlie from IdeaHub & John Roche
February 22, 2024
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Case Study
Building A Niche Startup to 100,000 Users
This week we had the pleasure of talking to Jason Louro, who is the founder of two SaaS startups.
The first is Campfire, a writing and storytelling platform used by over 100,000 aspiring writers.
And the second is Rehance - a plug-and-play platform for integrating AI assistants into any SaaS in minutes.
At first glance, they sound like two entirely different products, but as we’ll see, they are ultimately linked.
Here’s the full story…
How Campfire got started
Campfire was born out of Jason’s passion for screenplays at University.
He built a platform for aspiring writers like him to plan out storylines and write books.
He also included niche features like maps and timelines for science fiction and fantasy authors who were his main customers.
“The fastest way to sum it up is if Notion was tailored specifically to building a narrative and writing a book.”
Jason got exposed to Java during High School and moved on to web development at University.
However, the initial MVP for Campfire was a completely offline desktop application called CampfirePro built with Electron.
How Campfire got its first customers
Jason built the MVP over three months and joined a few Facebook groups where aspiring authors would hang out.
“I was just asking them ‘Hey, I'm working on this thing, does it seem interesting…?’.
I would post a screenshot or kind of describe how it worked and direct them to a landing page with an email newsletter.
And I collected probably 100 emails or something in total.”
Jason knew that being offline, the initial product would not be able to sustain a subscription model so he decided on a one-time download at $50.
From his waitlist of around 100 emails, he converted 6 into paying customers!
Finding a co-founder
Jason’s now co-founder and CMO Jackson, was part of a writing group at University and emailed Jason for a group discount on Campfire.
They exchanged emails back and forth and discovered that Jackson had a lot of ideas for marketing Campfire to other writers.
“I agreed to bring him on board for like a few weeks paying him some small amount for him to run a couple of ads and do some social media stuff.
And then that graduated to getting a revenue share and eventually to equity.”
Ramping up growth
Jackson convinced Jason to shell out $2,000 to pay a YouTube influencer to promote Campfire.
This one YouTube promotion led to almost $15,000 in new sales! So they knew they had something!
“It was amazing, but I’m not sure it can work today. This was back in 2018 when YouTube partnerships were still quite new.
We would see really strong click-through rates to the site but now we run the exact same promotion and they barely cover costs.
It’s the ‘law of shitty click-throughs’.
With any new marketing channel, there's a period of time when it does really well. And then, as people start to see the patterns the trust disappears and it drops your click-throughs.
I would say this is a weakness of Campfire, but we didn't go hard on TikTok. The advertisements can do really well because people haven't figured out the new marketing style yet.
It's a new thing still, and the law hasn't applied yet. But it will!”
So if you're considering TikTok for marketing - take the opportunity!
Pivoting to a subscription model
Campfire drew on the feedback of its hyper-motivated niche audience.
This was a massive advantage early on as this kind of customer tends to be much more enthusiastic and vocal about what they want.
Eventually, Jason decided that to grow the platform further they needed to move to a subscription model where customers would primarily use a new cloud-first web application.
“It was a bit of a headache as we had to let users try the new system and then migrate them across if they wanted to.
But the platform was a big improvement and so customers were mostly happy to commit to a subscription for what was a better experience.
We also did a Kickstarter for the new platform, not necessarily for cash but more for marketing.
It was a great way to meet authors and let them know that we were building this thing.”
Diversifying growth channels
Usually, startups find one ‘golden goose’ growth channel that brings in 90% of their customers in the early days.
But as you scale it’s important to recognise this as a risk and start to diversify.
Jason knew this and while they still do YouTube and TikTok promotions today, they are more focused on SEO and other more long-term channels.
But the team has also found one intriguing marketing strategy…
“Every year we sponsor National Novel Writing Month.
It’s a competition that runs every year in November where a huge community of global writers try to write about 50,000 words or a good chunk of a book.
It makes sense and always brings in good traffic and sales.”
The future of Campfire
Today the Campfire team are 11 people across marketing and product development, and they are on track to cross the magical $1M ARR milestone this year.
But Jason sees this as just the prelude to the real business.
He thinks there’s a much bigger opportunity that he hopes to capture with a new mobile app…
“What we're doing that's interesting is using what makes us special as a writing platform, the ability to flesh out characters and worlds and allow the creation of extra content that's supplementary to the main book that you're writing.
We're gonna let authors sell that extra content on the Campfire app alongside their books.
So instead of just buying the book you can also buy this bundle of bonus content that takes readers deeper into the story.
And so that's the long-term play - trying to be the leading reading app for fantasy and science fiction.”
A cool idea, and one that should scale really nicely if it takes off!
So where does Rehance come in?
What having a vocal audience gives you is a really great feedback loop to learn what customers want.
“One problem for authors is that they have a lot of chapters. And sometimes they want to rename them all according to a different format e.g. ‘Chapter One’ vs ‘Chapter 1’ etc.
But in general, there are a lot of products where pain points come up and you know it’s going to be frustrating for users to do it themselves.
And so Rehance is going to be a pop-up assistant that lets the user type in what they want to do, which will use an LLM to convert it into a bunch of function calls that perform the task(s) in a few seconds.
The benefits of Rehance for founders
At the most it’s an AI assistant helping your customers work faster and at the least it’s a magnet for your most frustrated users.
Often if users sign up for a product and come up against a tough pain point they’ll just leave and try something else. Very rarely do they email and ask for help.
However, having Rehance integrated will be the first place users can go to find easy solutions.
And even if they don’t find anything and still churn, you as a founder still gain that valuable data on what they were trying to do.
It’s an awesome way to track down why people are churning, so check it out if that’s something you’re looking into!
That’s it for this week!
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