$700k MRR, 100,000 Pay $7/mo For Gay Dating App Hornet, Will Beat Grindr?

sean-howell

In Episode #440, Nathan talks to Sean Howell, the founder of Hornet – the second largest gay social network with 15 million members worldwide, known for its ongoing “Know your Status” HIV campaign. He’s a speaker on mobile technology and his opinions have been featured all over the place, even the New York Times. Outside of work, Sean likes to serve on various non-profit boards and committees like the World Affairs Council, PFLAG, and UNAIDS,

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Famous Five:

  • Favorite Book? – Alibaba
  • What CEO do you follow? – N/A
  • Favorite online tool? — Insightly
  • Do you get 8 hours of sleep?— No
  • If you could let your 20 year old self know one thing, what would it be? – “I wish I started earlier”

Time Stamped Show Notes:

  • 01:38 – Nathan introduces Sean to the show
  • 02:13 – How Hornet generates revenue
    • 02:23 – Premium subscription model
    • 02:53 – Direct deals
  • 03:08 – Premium subscription service
    • 03:29 – No restrictions
    • 03:43 – 5% of their total user base
    • 03:37 – 15 million user base
  • 03:53 – Hornet was founded in October 2011
  • 04:13 – MAU
    • 04:22 – Metric
  • 04:42 – Total revenue in 2015
    • 04:50 – Fundraising
    • 05:17 – Multi-million revenue last year
  • 05:32 – Traditional advertising and mobile setting
    • 05:55 – Gaming companies are buying display ads
    • 06:20 – Direct deal with Uber
    • 06:34 – CPM
  • 07:10 – Demographic data for users
  • 07:40 – Churn number that is being tracked
    • 07:51 – Focus on user growth
    • 08:20 – Monetization
  • 08:32 – Total churn number
    • 08:37 – Different subscription packages
    • 09:00 – Monthly renewal
    • 09:33 – Users buy in at a lower amount
    • 09:49 – Average monthly churn is 20%
  • 10:00 – Raised $ 1.5 million in the first year
  • 10:26 – Costs in acquiring new paying customers
  • 10:32 – 40 employees
  • 10:44 – Getting customers through organic discovery and viral co-efficients
    • 11:00 – Viral co-efficient technique
  • 11:27 – Attribution links for social sharing
  • 11:53 – Sean is based in San Francisco and his team members are in other parts of the world
  • 12:27 – No revenue for the first year
    • 12:33 – Started making revenue in 2013
  • 12:48 – 2 biggest competitors
  • 13:00 – Looking to raise several millions
    • 13:08 – Valuation
  • 13:47 – Connect with Sean through AngelList, LinkedIn and his email.
  • 16:05 – The Famous Five

3 Key Points:

  1. Be motivated – use your competitors as inspiration.
  2. There are tons of ways to make your brand known without spending much.
  3. Start early – if you want to do something now, do it now.

Resources Mentioned:

  • Toptal – Nathan found his development team using Toptal  for his new business Send Later. He was able to keep 100% equity and didn’t have to hire a co-founder due to quality of Toptal  developers.
  • Host Gator – The site Nathan uses to buy his domain names and hosting for cheapest price possible.
  • Freshbooks – The site Nathan uses to manage his invoices and accounts.
  • Leadpages  – The drag and drop tool Nathan uses to quickly create his webinar landing pages which convert at 35%+
  • Audible – Nathan uses Audible when he’s driving from Austin to San Antonio (1.5 hour drive) to listen to audio books.
  • AngelList – Sean’s AngelList account
  • LinkedIn – Sean’s LinkedIn account
  • Sean@hornetapp.com – Sean’s email address
  • Show Notes provided by Mallard Creatives