How to Earn 100 True Fans and Your Financial Independence with Jay Clouse of Unreal

Courtland Allen: 0s

What's up, everybody? This is Courtland from indiehackers.com and you're listening to the Indie Hackers Podcast. More people than ever are building cool stuff online and making a lot of money in the process. On this show, I sit down with these indie hackers to discuss the ideas, the opportunities, and the strategies they're taking advantage of so the rest of us can do the same.

Today, I'm talking to Jay Clouse. Jay first popped onto my radar when he posted on Indie Hackers that he sold his community to Pat Flynn from Smart Passive Income. You typically don't see communities get acquired and that's because acquirers are really investors. They want to buy your thing and then they want to see it get much, much bigger in the future.

Communities are kind of a tricky beast where there's no guarantee they're still going to be good as they grow. In fact, a lot of communities get worse as they grow. So, something that might be working really well at a 100 people or a 1,000 people might turn into complete and utter chaos at 10,000 people or a 100,000 people.

So, to be able to sell your community means that whoever's buying it has the utmost faith and trust in you. They really think that you're a badass and you're going to be able to not only grow this thing but hold the ship together as it scales.

Jay is indeed a bad ass. In this episode, we talk about his journey as a creator, we talk about these new audio platforms, Clubhouse, Twitter Spaces, how to use those to build your audience. And we talked about the journey from basically making $0 as a creator, to being 100% financially independent and able to do whatever you want. Enjoy the episode.

I’ve got like a million and one things I want to talk to you about, but you had kind of a cool year. You described to me a few weeks ago that this was your biggest year as a creator. You said this is the first year where you hit six figures in revenue. Is it cool if I share that, could I say that?

Jay Clouse: 1m 55s

Yeah, that's cool.

and Allen: 1m 56s

Yeah. Six figures in revenue as a creator. That's great. That's enough where you clearly don't have to work a job for the man. You can do whatever you want.

Jay Clouse: 2m 1s

That's true. And then I went and got a job for the man.

Courtland Allen: 2m 4s

Yeah, got a job for the man basically, but the good man, you know, there’s the bad man you don't want to look for it. And then there's Pat Flynn. He's the ideal sort of person to work with.

So, I guess the second exciting thing is that you tweeted about this, you posted on Indie Hackers about this, that your community got acquired. The exact way you phrase it, your tweet was, let me pull it up, you said that your virtual accelerator and private community just got acquired by Smart Passive Income.

We’ve talked about this. Which one is more exciting to you: the fact that you had this huge year as a creator or the fact that despite having a huge year, you now, technically you have a job and your community got acquired?

Jay Clouse: 2m 42s

Oh man. It's tough to say. They're both equally exciting, but they both interplay so well.

Let's start with the creator side first cause this is crazy to me. For the last four years, I was trying to get to a point where I was like, okay, I want to be very comfortable independently and have a lot of optionality.

Really honestly, even just the last four months have been where that really, really came on. Then at the same time, I kind of unlocked that optionality, hit that mythical six figure mark, but the opportunity that I had with SPI and what I could do there while also being encouraged by them to continue my creative work, it was just like having my cake and eating it, too. It was amazing.

Courtland Allen: 3m 25s

Is this what you mean when you say optionality, you don't want to have to quit anything or you want to have as many possibilities? Why go for optionality?

Jay Clouse: 3m 32s

So I kinda, this SPI thing happened at the perfect time where it was like, okay, well, I proved that I could do this and now I have this great financial economic engine of my own building over here that's growing an audience, that's continuing to build upon itself, but at the same time, I see this really special opportunity at this point in time to focus what I've learned about building community inside of an even greater ecosystem to prove out a lot of the theories that I have around community and serve even more people, which theoretically could also feed into some of the stuff that I'm doing.

It just felt like this is a really good fit for me. I have a good friend, David Sherry. He and I have been good friends for a long time. He started Death to the Stock Photo and he told me one time that he thought my superpower was building community.

This was like three or four years ago and I just wrote it off as like, yeah, but who cares about that? That's something I do and I like doing it, power stuff, but nobody cares about that. Now people care about that.

Courtland Allen: 4m 31s

Community’s big.

Jay Clouse: 4m 33s

It's like, oh, now this seems like something I can really step into as a strength and step into it credibly and not feel like I'm fighting upwards to say pay attention to me for this. It's more like, I've done this. I'll write about this. You can pay attention if you want but I'm very confident that I can step into it and talk about these things.

Courtland Allen: 4m 46s

Right. I don't want to say sell out, but why sell? Why? You have this entire career life you built for yourself. You finally got to six figures in revenue. You've got maximum optionality. You can do anything that you want. You literally have no one who's telling you what to do. You can quit anything, you're totally free. How do you even think through whether or not you want to sell your community to an acquirer or stay independent and do other things?

Jay Clouse: 5m 8s

I wasn't thinking about it. I wasn't shopping around. I wasn't seeing, like, what would the market value of this thing be? Honestly, I had been working with the SPI team for six months and we had the beginnings of something pretty special with SPI Pro, but I was a contractor. We were getting to a point where it's like, we were both looking at what happens now after this transition over? Do we go to another contract?

Courtland Allen: 5m 29s

So you’re supplementing all of your creator stuff. Cause you also have a podcast, you also sell courses and you've got a community. So, you're supplementing that with doing contract work with SBI and presumably other clients, too.

Jay Clouse: 5m 40s

Mostly SPI. I had mostly dialed back to just working with them and then earning enough of an income from my other stuff that was enough to get by.

But it got to the point where Matt was like, well, what would it look like for you to join the team fulltime? Is that something that you'd be interested in? And I was like, I don't know, I got too much stuff in flight. I got this community, I've got my own projects. It's all going really well. And he's like, well, we're really interested in this, this and this. What, what if we acquired Unreal Collective? And I was like, oh, well, that's interesting. I hadn't thought about that.

Courtland Allen: 6m 8s

So you've got a very tangled web here of a million different things that you're doing. I'm curious, how does it all start? If I want to be a creator like Jay Clouse, what's the very first thing that you do, a podcast, a course, blogging…

Jay Clouse: 6m 20s

Not a podcast. I love podcasting. I have a course on podcasting. But podcasting is a really long game and it's good to get started now because it's going to take a while for you to build an audience for sure. But to me, you start with services, you start as a freelancer, or you start, if you have some authority and some recognition and people who would already want to pay you for something, Unreal Collective, the accelerator program was basically a mastermind program, it’s a coaching program. And in that I got to scale my time across five people at a time, which was a pretty great hourly rate, which saved a lot of time and space for me to create these assets.

Courtland Allen: 6m 59s

So it's like being a service provider. Let's say you're a software engineer for one company at a time. You can make a decent amount of money, but not that much because it's one client at a time. But if you decide to teach five people, you can bring them all into one community. You can basically charge five times as much because you’ve got five people at a time. Where do you get those first five people for unreal collective? How did anyone even know that you are offering this thing and decide to pay?

Jay Clouse: 7m 21s

The first thing that I did was I did a 12-week program for free for five people that I thought were working on something interesting that would stick with it and show up, even though they weren't literally invested in it and would have interesting stories coming out of it.

After I worked with those five people, I documented their stories and their progress. I put that into a sales page and then that became what I went out and had as social proof to do the first paid program. Even then, for the first couple of cohorts, it was a lot of outbound emails, to be honest.

I had already built a relationship over the years with a lot of people in my own city who are business owners, because I was organizing Startup Weekends for years. I sent a short email to people who I thought would be fun to work with, who I thought would benefit from the program. And I said, hey, I have membership opening for Unreal Collective. It can help you go from A to B on what you're working on. I think it would really fit you well, zero pressure, zero expectation. If you have any interest at all, let's get on a call, very short and the win was let's get on a call.

Then I would ask them a lot of questions about what's going on in your business? How are things going? What's a priority for you? They would talk and talk and talk in a good way and I would learn a lot about their struggles and I could very quickly see, oh, you're actually dealing with the exact same thing as Annette, who's also in this cohort. I think you'd get a lot out of this. We'd love to have you. Again, zero pressure, expectation. I never hard sell anybody. I just affirm for them, hearing your situation, I can tell you that this will work for you if you want to do it. If you do, that'd be great.

That worked for the most part. Then it got easier. Every following cohort got a little bit easier because there was more social proof. I did a really good job of capturing testimonials from almost everybody who went to the program and turn that into a success story for everybody who went through the program and did a testimonial.

You go to the website and you're like, is Jay just blowing smoke? Does this really work? You're like, oh, here are 40 people who already did this 12-week experience and this is the results that they saw. This is great, but services income is always going to be the fastest way to income, but you need to embrace being a business owner. You need to embrace being a freelance business owner so that you're actually getting yourself enough money and time to build the thing that you want to build.

Courtland Allen: 9m 40s

I love this high touch model because a lot of people start and they just want to start at step five. They're like I'm building a scalable software product as an indie hacker. That's really hard. You’ve got to kind of market it. People, they don't really know why they should use your thing and it's competing against all those other scalable software built by other people who have bigger teams than you and bigger budgets than you.

But if you're just literally reaching out to people one at a time and you can give them this really crafted pitch, I know exactly what you're working on and I want to hear your PR hear about your problems and your challenges. You're just gonna be able to provide something way better than somebody who's trying to make some sort of one size fits all product.

You can also charge more out of the gate. You're probably charging at least a few hundred bucks or something, whether, whereas people will software try to charge five or 10 or 20 bucks a month.

Jay Clouse: 10m 24s

Yeah, I did the math at the beginning. I was like, if this is 12 weeks, which the program was, how much would I have to make from how many people and do this three times a year to get by if this was my only means of income. I did the math and over time, I literally doubled the prices.

I started I think $400 for 12 weeks of just the group calls. At the end it was $999 for the base level. I knew that I was going to have to deliver this experience and this outcome for people. I was going to be staring at him in the face for an hour every week for 12 weeks. I wasn't going to try to sell them into something that I didn't think was going to set them up for success.

It's not gonna be a fun time for anybody, because it's a group call, if they're not having a good time, they could very well make it so that other people in the call weren't having a good time too. So, you genuinely had to make sure that they were a good fit and the best way to do that was to have these calls.

Courtland Allen: 11m 15s

Would you describe Unreal Collective is, you described it as an accelerator, you described it as a community. I guess it is a community cause kind of the value comes from the people on the call. It's not just you monologuing at them and telling them what to do. They're each talking to each other. What would you say is something that you learned about community by running these communities that the average person doesn't understand?

Jay Clouse: 11m 32s

The other reason why it was a community was because after the program, you were still invited to stay in the Slack channel and it was incredibly active. Everybody who had gone through the program was still in there and because it grew like 15 to 20 people at a time, to answer your question, everybody got to know everybody really, really well.

It wasn't like all of a sudden the people who would invest a lot of time and energy into this community were now overwhelmed with a hundred new people who wanted to do things a different way or didn't know the etiquette. It was all very smooth and slow and you can integrate people well.

This is the thesis of joining SPI is now that I've seen how to take small groups and build a community slowly and have high touch connection and make them really love it, how can I meet in the middle with a large audience and a larger community to try to scale that experience? Which is an inherently very difficult thing to do, but you have to have experience at the low end to be able to try.

Courtland Allen: 12m 30s

It's like you started your own miniature Y Combinator. I'm gonna get a bunch of founders and entrepreneurs and put them together in these little cohorts and help each other and connect them to each other. You don't need a huge brand to do that. You just need to make these sales emails and your own personal reputation and kind of these testimonials from people who've done it before.

It just becomes more and more valuable the more people you get into it, because like you said, they're all in the Slack group. I think there's so many ways to capitalize on that. You can just charge basically a straight fee like you were doing to different people.

There are also these really huge communities. I don't know if you're familiar with these executive peer groups, there's YPO, Young Presidents’ Organization, EO, Entrepreneurs’ Organization. People are often sleeping on how big these things can get with their membership fees.

For example, YPO, it's only for CEOs, you have to be a CEO to join. They have 30,000 members and it's like $3,500 a year or something to be a member. The people who join are all CEOs, they're all super rich. So, they’re like, of course, I'll join this thing. They're making, that's like a hundred million dollars basically a year that they're making from a community that's really, really scaled up.

Entrepreneurs Organization is kind of the same. I think you have to be a founder or an owner of a company that's doing like a million in revenue or something, but it's like 2,500 bucks a year. They have tens of thousands of people, same thing. Then they have kind of the scaled-out community experience like you did where they just have these discussions with like five to 10 people. They train volunteers from within the community to lead these discussions. So, it's super scaled up and they just make a ton of money and also provide a ton of value from people we want to meet their peers. That's kind of one way to scale community.

Jay Clouse: 14m 1s

Some of the things you’re pointing is underlying important things to understand. Knowing who your people are and what their threshold for what meaningful versus non meaningful membership dues is. With unreal, because my people were early-stage creative service providers, I'm not going to go to charge $3,500 a year. That’s not going to work. There's an inherent ceiling on what I can do for membership dues.

That's important to know if you're trying to build a paid community is who are these people? What can they actually pay? Cause there needs to be a match of price to value to where they are.

As far as how to scale things, I really do think that you need to put a lot of energy into very unscalable aspects of it. One of the things that I call back to a lot is the idea that when we think about building an online community, we aren't thinking often enough about what worked offline.

Because if you start to think about your online community as a meetup that happened in your hometown, when people show up to that meetup, they probably drove across down. They'd probably put 15 to 20 minutes into getting there. As soon as they get in the door, the first thing they do is they look around for people they know and are familiar with so that they start to feel comfortable in the space. But if they don't see that they'll probably stick around because they already made the trip.

In an online community, if they show up and they look around, they don't see anybody they know, and they don't necessarily feel welcomed right away, it’s so easy, so easy to leave. You never, you might not even know they came. Its's really about how do you welcome people into the space and get them to feel like they belong there and that they know somebody there and if they go missing that they're going to be missed.

It's really hard to do without putting lie a lot of intention and honestly resources into it, whether it's people or money it's, it's all kind of the same thing.

Courtland Allen: 15m 51s

Yeah. I think there’s a lot of advice nowadays like you should build an audience, get a giant audience, whereas a community is not necessarily an audience.

It's people talking to each other rather than just listening to you. But I think it's super valuable because there's a sticky connection of the people in your community. If you do what you're saying and make sure they're welcomed and they feel missed if they're gone, they just develop these relationships with each other. They're probably not going to leave because these relationships are so important and hard to find elsewhere.

Whereas with an audience the only value you're getting is a message that somebody is writing or emailing to you. That's super easy to find elsewhere and you could easily just leave and no one's going to miss you.

I think, if you're starting a community, it's super important to do what you're saying and basically realize that the value comes from these connections, but you gotta do a ton of work upfront to make sure that people are forming these connections. Eventually it becomes really scalable.

Eventually, I won't say you don't have to do very much, but with audience building, you always have to be putting out content. You can never really get off that treadmill. With community, you can eventually sort of sit back a little bit and people will talk to each other.

With these other organizations I mentioned, basically the people that they're training who have prepaid these membership dues are the ones leading the sessions. With Indie Hackers, we had our offline community, which was all these meetups pre-COVID. We were having 60-70 meetups a month and I didn't tell anyone what to do. Everybody just sort of did their own scalable thing. I think that's the value of community, the scalability, but you can't really skip ahead.

Jay Clouse: 17m 13s

That's such a good insight because I think community scales when the community scales itself. If you're trying to scale it as the one person pushing it forward, it's probably not ready to scale yet.

One of the things I think about a lot in this space, too, is as creators, we can look at the growth of the music industry and artists in that way as where things can go. Think about The Beatles. They had a ton of fans. They had an audience and the audience would go to the shows and that almost looks like a community cause now you can have interaction with these other people, but you're still actually there to see the main attraction.

The Beatles weren't like, how do I get my fans to talk to each other? That wasn't really the concern. But if you think about yourself as a creator and you are The Beatles in this world, people might be showing up for your work because they love your work, but how do you make sure that they're actually talking to each other?

That takes some intention and design around the space because otherwise you're just like, hey, I've got an audience of 2,000 people. I now have a tool that's a digital community platform. If I throw the two together that doesn't make magic happen.

They might come and they're like, where's, where's Jay, where's the attraction? It'll be fun and exciting for like 30 minutes. Then they’ll be like, okay, where do I go? Where's the food? I’m bored. That's it. We're going to see a ton of that over the next two years, is people just throwing their audience on a platform not understanding why it isn't sticking. And people are going to get a bad taste in their mouth.

Courtland Allen: 18m 35s

Yeah. It's like when I go to a conference. Often it's a combination of audience building and community building where people will essentially come for a talk ostensibly, but then the talk’s over, you go into the hallway and that's kind of where the community is. Everybody's talking to each other, entertaining each other, but online that doesn't happen.

You send a newsletter and you're like, all right, everybody came to my talk, they read my newsletter. And then I got a link to a forum, but no one has any real reason to talk to each other. They're not going to naturally bump into each other like they would at a real event.

Jay Clouse: 19m 2s

I mean, that's one of the things that makes Twitter great and why people love Twitter is because it seems easy to bump into people and send them a DM. It's like, oh wow, we're actually communicating now. That's what happens at in-person events. A lot of times it's like, oh, there's a speaker here and I can talk to him. Access is there. You can have serendipitous access if you put a little effort forth. It doesn't happen as much in most online spaces.

Courtland Allen: 19m 21s

Let’s talk about tools for a bit because you are building the Smart Passive Income community on Circle. It's a super cool tool for community builders. You built Unreal Collective on Slack for the most part, and I guess zoom calls as well.

Then, what else we got, we got Twitter, which is hard to build a community on, but easy to build an audience on. Then there's Clubhouse, which I don't know if you've used, but it's obviously been blowing up all year. I think they've got like one to 2 million active weekly users or something crazy. They just got like a billion-dollar valuation and everybody thinks Clubhouse is potentially the future of a community.

Let's talk about maybe Twitter. You’ve got like 5,000 Twitter followers. How are you using Twitter to build an audience to sort of feed into your role as a creator?

Jay Clouse: 20m 4s

I hadn't really thought about it very intentionally. I just kind of felt like I've got to exist on these platforms for a really long time. Luckily, I did build an account in 2009, which is relatively early for Twitter, but I haven't really put a ton of effort into it until maybe the last year and more even so the last couple of months.

Honestly, what I'm realizing is, if you look at the way people use Twitter you see some clear patterns of, oh, if you do this type of content, if you have these types of threads and you talk about these types of things and you get retweets, you get picked up, you get follows, yada, yada, yada.

It just doesn't fit for me, which sucks because, I can see the recipe and I get the recipe. I'm equipped to do the recipe, but I don't want to do the recipe. So, for me, I'm treating it more like a community. Now, honestly, the things about community are like, ask questions, get people's opinion, engage with people and they engage with you, be helpful to people, connect people.

You can do all that on Twitter really, really well, just the same way that you would in your community. And so that's, that's more and more what I'm trying to do lately.

Courtland Allen: 21m 5s

I love the question-based approach to Twitter because if you ask a question where it's obvious that the responses will be valuable to read through, it's a win-win for both people who want to participate and who want to just read.

If you're like, oh, how did you get your first 10 users or something? If everybody shares, it's not just cool to share because you can share, maybe promote your product and what you're doing, but also you want to read through that as somebody who's reading.

Almost no one is using Twitter that way. It's super rare. Almost everybody's using Twitter to build an audience for themselves rather than to sort of connect their followers to each other.

Jay Clouse: 21m 35s

It actually could be helpful. You can crowd source things super quick. I genuinely ask, like yesterday, I'm like, how do you guys turn your brain off at the end of the day? Because we're all living and working in the same space. So, when the day's over, how do you know and how do you switch off? I have a very hard time doing that.

I got a ton of responses and a ton of ideas, and that was really great.

Courtland Allen: 21m 55s

What are you going to do?

Jay Clouse: 21m 56s

I really liked the approach that a lot of people said of mark a clear time at the end of the day and then have a ritual at that time. That ritual could be I'm going to spend the next 20 minutes checking my email, make sure there's nothing super fire based, but I'm going to close out chat, I’m going to closeout everything else. A lot of people just leave your phone in the bedroom, which is the obvious answer. I should do that. I used to be able to run because it was warm enough here in Ohio that I could run after work

Courtland Allen: 22m 24s

Back in the good old days of not winter.

Jay Clouse: 22m 26s

Yeah. That was a good transition. That was really great, and it just feels more natural and more helpful to me than to be like I'm going to construct a 12-tweet thread of me proselytizing something. I get that that works and it could be valuable, especially if it's thoughtful and it's genuinely helpful, but it's just not the format that I like.

Courtland Allen: 22m 48s

No, it isn’t that super fun. I know a few people who are really good at Twitter threads and they talk to each other about how to be good at Twitter threads that are going to like maximize retweetability.

None of them were having a lot of fun writing these things. I think they get shared really widely. They have mass appeal because so many people were just reading through Twitter. And if you come across an entertaining story or a bunch of random advice, yeah, I might as well retweet it.

But I don't think that necessarily translates into if you're tweeting these it’s super fulfilling or that the people who follow you are going to later on feel like they want to buy your products or use whatever you make or talk to each other. So, I'm kind of right there with you. It's hard to use Twitter that way.

I think the people who do, it's hard not to compare yourself to them because you have the same unit of measurement, like how many people follow you or how many retweets that you get, but ultimately, you're doing different things. If someone's got a hundred times as many retweets as you're hitting, but they're doing something you don't want to do, then you're better off just not comparing yourself to what they're doing.

Jay Clouse: 23m 43s

Yeah. Well, I actually love your take on it recently, too, where you're talking if you're building a Twitter audience to maximize optionality for optionality sake, it's just not necessarily useful or serving you. Why are you doing it? It can be a huge time suck and it's not an asset that builds on itself over time.

If you put that same amount of effort into writing a really great essay that maybe even is constructed for a key search term. The last big essay that I wrote was about building community and why I'm really bullish on Circle. That has brought me so much value and staying power and has introduced really interesting people into my life, and actual monetary reward, too.

So, I want to tend towards that. If I'm going to put effort into thinking through something that has a bunch of structured points, I'm going to put it in something that can live evergreen and continue to generate some sort of benefit.

Courtland Allen: 24m 38s

So who do you think about Clubhouse? Have you used it at all?

Jay Clouse: 24m 43s

I kick myself every day for not spending time on it.

Courtland Allen: 24m 48s

Well, you don't have to do that.

Jay Clouse: 24m 49s

Because, well, and to deconstruct that, I love audio and I love podcasting. I think I'm a pretty good speaker and it just feels like this plays to my strengths. I've been looking for years at what is the thing that's going to pop up that I can hop on early and build this unfair advantage that so many creators tell me that they had when they started writing in 2008.

Clubhouse is the clear answer, the first one that's come around in a long time and I'm just not spending time on it. I don't know why other than it seems like a big time suck and it's hard to go from a mindset of I want to craft 45-60 minute, highly produced, beautiful pieces of dense, useful audio for creative elements. But then I'm also going to go on Clubhouse and just speak for two hours with no clear agenda.

I just don't get it. But business owners I talked to were just raving about how incredible it's been for introducing them to a larger audience and building their audience. I knew it would come someday and here it is and I know that I'm adept, I'm suited for it, but I can't get myself to get in.

Courtland Allen: 25m 48s

I'm skeptical that people are building really big audiences on Clubhouse. Let me change that. I think people are building big audiences on Clubhouse that stay on clubhouse. I’m skeptical that people who have built big audiences on Clubhouse that have then translated into like thousands of podcast listeners or Twitter followers or mailing list subscribers. Maybe a few people have.

My thoughts on it are this. I've been spending some time in Clubhouse. Number one, it's live, which is super fun. If you were to pop in and just try it, you probably would get addicted and it would be a time sink for you because just being able to on demand pool a few of your friends into a room and have a conversation about anything you want, it's super addictive.

It's really hard to do that anywhere else. Even for you and I to talk, we're like, oh, let's schedule a zoom call and put it on the calendar and shift it. On Clubhouse, it’s oh, Jay's online. Let me ping him and we just start talking. That said, if you build an audience on a live platform and you go live, a very small percentage of them actually ever see what you have to say.

On Twitter, I've got 38,000 followers. If I tweet something, I might get a 50,000 impressions. Not only does my audience see it, but a bunch of other people end up seeing it. On Clubhouse, it's like 1%. You could have a million followers on Clubhouse and you're going to get like 10,000 people see it, or you can have 1,000 followers and you get a 100 people are going to see it, 10 people are going to see it.

It’s like how live is everywhere. I've seen a lot of YouTube channels where people have like, I don't know, a hundred thousands of subscribers and their live videos have a thousand views.

So, if you’re used to doing things that aren't live, I think Clubhouse is going to be kind of a kind of sad because such a small percentage of your audience actually sees those things. Then it's totally ephemeral. People don't save or record Clubhouse conversations. Unlike a podcast, they joined in the middle of it, so you're like halfway through talking about something and people don't even know what you're talking about. They joined up and it's kind of disorienting and confusing.

I know I'm just, it's a non-stop hate fest right now. There are good things about it, too.

Jay Clouse: 27m 37s

I'm also interested to see what is the impact on podcasting generally? Cause I think audio is kind of a zero-sum game. You only have 24 hours a day. You're only going to dedicate so much time to listening power.

So, if Clubhouse continues to pick up and that's the audio people like to tune into as their form of radio and intimate audio connection, is that going to tank certain podcasts? I don't know. Or will they rebound and say, this was fun for now, but I actually do miss people respecting my time and intention with thoughtful, highly produced conversations.

Courtland Allen: 28m 7s

Yeah. The other thing about Clubhouse is the fact that there's so much guests participation. Even if you do prep a lot for a Clubhouse call and you bring on the right people, people will kind of get upset if you don't bring random people onto the stage. And then random people onto the stage usually aren't that well-prepared and they don't really often add a lot to the conversation. It's like one in 10 really add a lot to the conversation.

So, as a listener, I'm much more into podcasts and audio books where I know I'm going to get a particular thing. But as a speaker, I like Clubhouse because it's so on-demand and so easy to just jump into a conversation.

Jay Clouse: 28m 40s

If I was going to jump into Clubhouse tonight and I wanted to be a guest in a conversation, how easy would it be for me to be able to get into conversations that are happening and contribute?

Courtland Allen: 28m 50s

It depends entirely on who your friends are and who you know. If you know someone on the stage and it's a topic you want to talk about what'll happen is that they'll probably follow you and you will show up in a little following section. There's a pretty good chance they'll be like, oh, Jay's on. Let me invite him up to the stage. Jay’s a smart guy has got stuff to contribute.

If you're joining rooms where you don't know anybody, then it's going to be hard because you're going to be one of a hundred, thousand people who are might be raising your hand or trying to get on the stage. Some rooms are super open about it, but those are often not the rooms you want to join anyway cause it's just a bunch of random people talking about stuff.

You want there to be some curation. For Unreal Collective, your community, it's curated. Not everyone on earth can join. Certain people can join who have a lot to contribute. In Clubhouse, any random person with a millionaire, get rich quick scheme can get on the stage and start bloviating about whatever their strategy is. And it's not that valuable.

Jay Clouse: 29m 39s

I just, I don't know. I just can't, I don't know if I can get into it.

Courtland Allen: 29m 43s

Well, what about, let's talk about Circle, then. Circle’s the platform you've been raving about. It's a community building platform. It's kind of, you've got different options. You can use Slack, you can use Facebook groups, you can have chat-based communities on WhatsApp or Telegram. Circle’s, a fully-fledged, web-based community. Why are you so bullish on Circle?

Jay Clouse: 30m 2s

Well, first and foremost, it's because the team understands me as the customer and as the user. They know my motivations and they know what I want out of the platform. They have experience building platforms like that before.

They come from Teachable, so I know that the team knows the use case. It's my use case. They know what I want and the things they’re going to be shipping and shipping quickly are the things that I care about.

About three years ago when I was doing Unreal and I was thinking about it as a potential community and place where I make a living, I was really frustrated with my choices of what software to use.

Slack has a clear limit of how many people can be in there and how it can stay tightly knit as it is. I think if you get beyond 200 people in Slack I wouldn't be able to have the same relationship with them that I did with Unreal.

The other options were Discord, which is Slack for gamers, or Discourse, which is kind of a gnarly old school looking forum, but very functional, but felt very out of workflow, and Mighty Networks, which actually seemed like it should be a great solution.

I'm sitting here as a community builder that really wanted a different platform. I thought about building it. This is the closest I came to getting really into indie hacking was like, okay, let me just build something.

I pulled together the smartest UX designer that I knew in town. I brought together two incredible developers in town and a really great strategist. We just whiteboard it all day. I'm like, here's what I want to do. Here are things that I want to do here are the things that I can compare it to. Here's what is great about a subreddit here's, what's great about Indie Hackers. I brought Indie Hackers up and I just couldn't come to a solution of, why doesn't Mighty Networks work.

Courtland Allen: 31m 49s

Right, just use that.

Jay Clouse: 31m 51s

What might I build that's not mighty networks. So, I just gave it up and honestly, Circle is a forum software. It's not functionally much different than Discourse, but the UI is better. They understand this specific customer better. I know as they get into, they just launched the iOS mobile app yesterday. As it moves into Android also, that experience is going to be really good.

I know that to scale a community, you need something that is more searchable and threadable and can be broken down from big into small.

So, a lot of what we do in SBI Pro, the SPI community, everyone in there is a member of SPI Pro, but then we start to segment people into different topic areas, into different clubhouses actually is what we're calling them now, into masterminds that are like real-time meeting groups. So, there are a bunch of different ways you can engage in small groups inside of this larger group.

You can't really do that in Slack effectively. You can't really do that in other things. Again, Mighty Networks just should have worked, but I could never get into it. I don't know why. Now it's as they're becoming more of a holistic business platform. It feels like it's even moving away from the use case I wanted and it feels kind of slow and almost bloated.

So, Circle just feels like the most directionally correct for me as a creator and the use case that I have.

Courtland Allen: 33m 14s

Yeah. One option you didn't mention is Facebook groups, which I've seen a lot of people build communities on. It doesn't seem like it's tailor-made for communities. It's definitely not tailor-made to break people down to the subgroups as you try to scale up your community and you need it to still stay personable.

In fact, almost none of these tools are, except for Mighty Networks and Circle. Slack is not made for communities; it's made for companies. But there's an advantage to something like a Facebook group that almost none of these options have, which is distribution.

If you want your community members to be active and to basically just kind of in the course of their normal lives, stumble across the conversations and things happening, Facebook group is a pretty good option because people reflexively check Facebook and they'll see a conversation on their news feed and be like, oh yeah, I'm part of this community.

Whereas with something like Circle or Slack or Mighty Networks, or even Indie Hackers, I have this challenge of trying to get people to develop an entirely new habit to visit a community that's not in some place where they already visit on a routine basis.

Jay Clouse: 34m 13s

Yeah, I didn't, I didn't talk about Facebook groups cause I barely think about it. Honestly, the Creative Elements Listener Group is on Facebook cause I wanted to learn what it was like and I hate. I don't hate the community. I hate the product because yes, if you are not thinking about how do I make such a great experience that people want to show up, a Facebook group is a great solution for you because people are going to show up anyway.

There's no threading. It feels like chaos. You can have tens of thousands of people in there and you feel like, oh, this is a thriving community, but there's 20 posts a day and they're all in a single feed. It's on Facebook, which to me is its own detriment cause I don't trust, I don't trust the company. I don't trust where it's going long-term. The younger generation doesn't have Facebook. It’s just rented land.

I think people have more respect and appreciation for a private space that they think the creator has a lot more control and authority over, but yeah, Facebook is really great if you want something that is just going to show up in people's faces, whether they are thinking about it or not.

Courtland Allen: 35m 12s

We've talked about scalability and growing communities, which is tough because you've got to probably have to figure out a way to break it down like EO has done, like YPO has done.

But there's other things that go into community scalability as well. Again, you're one of the very few people to have sold a community that you built. I did it with Indie Hackers; Stripe owns it. Ryan Hoover did it with Product Hunt, which was acquired by AngelList. And there's been a few others, but I think the vast majority of communities are not that scalable and also not that interesting to acquirers.

So, when you posted about selling and joining the SPI community on Indie Hackers, I had a long comment about my thoughts on getting a community acquired. What's it look like and why most acquirers typically don't want to buy a community business.

A few of my points, probably the biggest one is that it's, if you think about an acquirer, they're basically an investor, right? They're not just buying something because they want it to stay the same size all the time. They're buying something because they want it to grow and scale and get bigger.

Unlike a software product, a community actually changes in nature when it gets bigger. it tends to become a little bit less personal, a little bit harder to run, a little bit more unruly, a little bit less exclusive, a little bit less curated with who's in it. What are your thoughts on having a community to be acquired?

Jay Clouse: 36m 23s

There are a couple of cases you could make. You can look at the really bullish case and say, well, a paid community is ARR, it's MRR or ARR. It's recurring revenue potentially that can be an incredible investment.

But we looked at it more from the standpoint of, in a paid community, the product you're selling and the benefit people are getting is out of your hands in a lot of ways. It's coming from user-generated content and relationships and things that are happening in there. It's a really tricky line to toe because there are likely some members of any paid community that you would be happier to let them have it for free then for them to leave because they are so valuable as a community member.

Unreal is this incredible community. We weren't looking at it as an immediate profit center of this is what we can expect in membership dues. It was more about these people are really well-connected to each other. We know they are incredible community members. We want to make an even stronger base of SPI Pro with some incredible, incredible members who are the same type of person.

I told the Unrealers, everything we're doing here, we're gonna be able to do at SPI and even more so because we have more resources. We get a whole other we have a community manager, Jillian, who is incredible. So, there's two of us now that our whole focus is making an awesome experience for you.

Not only that, you're in this space, but we're expanding the horizons because frankly, the average SPI member is further along than the average Unrealer was. It's all upside, but it’s scary. First of all, Slack to Circle is kind of a culture shock. It’s a very different community experience and it's scary to move, but it was scary for me to tell these people this is not like the investment of we know this is going to immediately turn into membership dues.

We didn't require a credit card from them to get in there. We're like we're giving you access for a year and let us prove to you over the next 12 months that you want to be here and this is an even better experience than what you're used to. If you want to continue membership after that, awesome. We'd love to have you.

It's hard because a lot of communities. They're fragile. They have a lot of ownership over their space and if you're like, by the way, actually I own this, this is not a co-owned space. It's a scary thing. I think you have to go into it with the right reasoning and not just disappear.

If I was like, hey guys, they own you now later. No, I'm in there every day. I’m genuinely still putting all my energy into making that a great experience. Now it's not only are you guys in here, you guys paid for the 12-week accelerator mastermind experience of Unreal Collective. That's a part of SPI Pro membership. You can have that now. You can have it.

It's all upside in that way. We think that this is a really strong base to continue to build from of really kind, thoughtful, smart, generous people who want to give back to each other.

Courtland Allen: 39m 30s

I mean, I think about the communities that have been acquired. None of the founders of the community, organizers, just peace and said goodbye, you're now our property. I think all of us have ended up going to work because we're sort of a crucial part of the community and people.

It's fragile, the community is going to have positive network effects where you get more and better people in the door and the community grows, but it can also have negative network effects where people say this place is dead, it's gone down the drain and everybody convinces everybody else to leave. There's been a lot of really big communities that seemingly died overnight because there's kind of a revolt among the people.

Unlike in real life, where if you revolt against government, it's very hard to go somewhere else. Online, it's super easy to be like, you know what, digg sucks, we're all going to reddit. Or you know what, and Indie Hackers sucks. Now we're going to whatever the new thing is. You have to be super careful about not upsetting people.

Jay Clouse: 40m 15s

Yeah. Negative network effects. I've never thought about that terminology, but that's exactly what I'm talking about with paid communities. Yeah, it can go to zero really quickly.

As a creator of a potential community, if you're thinking about having it to be a paid community, you need to take really seriously your own investment of time, energy in the beginning to get things going and to can you just stoke the fire and make it an awesome place because there's no value there if people aren't finding value there. It's kind of a chicken and egg type of thing.

Courtland Allen: 40m 44s

Let's talk about branding real quickly, then I'll let you get out of here.

Nathan Barry's been a really big figure in the creator space. Well before he started ConvertKit, which is a tool that a lot of creators use to send email, he was doing his own writing and blogging and had a newsletter and released books, et cetera.

He has one called “Authority,” where he talks about how do you brand yourself as a creator? There's a few different ways you can do it. You can create something that's a quote, unquote, larger than yourself. You create some brand that's not you. So, with Indie Hackers, it's literally Indie Hackers, Courtland’s not in the name.

Or you can basically name it after yourself. So, someone who has been super successful with doing that is somebody like James Clear, or Nathan Barry himself, where essentially everything James Clear does is on Jamesclear.com. Every blog posts he writes is on his website. His books are authored under him and people follow him because they really like what he's doing.

Nathan Barry kind of came down on the side of you should name it after yourself, because as you work on multiple projects, let's say you write two different courses and three different books, it sucks to have to create a different website for every single one of them. None of the brand affinity sort of accrues from one to the other. He just decided that's the best way to go.

The counterargument to that is, how does it ever become larger than yourself? How do you ever escape from that if you want to do something else? How does anybody else ever buy that or acquire that from you? If you’re wrapped into the brand, it seems like that's inextricable. What's been your approach? How have you thought about this?

Jay Clouse: 42m 4s

It's been both, honestly. Your name, your identity is something that you'll never separate from and that you won't sell.

I’m really excited about Freelancing Schools is this platform that I'm building that is not me centric that I'm building as I think I can make an asset here that's a cash generating asset that maybe could be sold someday and just very easily and very effectively. There won't be a lot of consideration outside of people know it happened, but I'm still getting benefit from it because the thing is generating the value for me and not the person.

On the other hand, I know that my connection to a lot of the people supporting me as a creator are supporting me as a creator. An interesting corollary here is Anne-Laure at Ness Labs. She has a named thing, but she is so central to that still. In that world, I don't know. I'd be interested to talk to her about that because on one hand it's like, oh, you build a thing with a name and that should be its own thing. But if you're still so central to it, is there any difference? I don't know.

I have my courses. I have a couple of courses under Freelancing School that's an asset and I instruct them, but it doesn't really matter. I have a couple of courses now that are on a jayclouse.com platform. My writing goes on jayclouse.com.

I'm thinking long-term, I want to build jayclouse.com as an asset that attracts new audience and people that I can help and will continue to do that, but that will evolve with me and in whatever form or fashion. I'm kind of hedging and doing both because I know I need, and I want, to personally connect with my people.

I love that when I write an email every Sunday, I'm just writing to friends. I literally, it feels like I'm writing a Zenga post sometimes, and I can just be me and it's so easy and it lets you be more prolific instead of putting on the Freelancing School hat. It's just different.

Courtland Allen: 44m 1s

That's such an interesting approach to do both at the same time and also a good point that you made that just because something is named differently than you doesn't change the fact on the ground that it might just be that you're central to it.

With Anne-Laure, she's very central to everything she's doing at Ness Labs and the Maker Mind community she's created. An opposite example might be someone like Lenny Rachitsky. I don't know if you're familiar with him, but he's got a very popular newsletter. It's named Lenny's Newsletter.

If you look at how he runs it, he takes questions for how do you become a better product manager? How do you do whatever? And it's not like he's this super genius who knows all the answers. He'll go out and find the best person and have them do kind of a guest post on that topic. Theoretically, even though it's named after him, a lot of the value is coming from the people that he's done the curation that he's doing and bringing to the table and someone could come in and basically do his job and not be Lenny and you wouldn't know because it's not necessarily written in his voice, every issue it might be in someone else's voice. Maybe it's less to do with what you name it and much more to do with how you run it.

We haven't even cracked even talking about your podcast and all the cool stories you could probably tell about how you got Seth Godin and James Clear to be your first interviews and stuff like that.

Hopefully I can have you on again, but maybe to wrap things up, you've been through quite a lot as a creator, obviously it's your biggest year ever this past year, you've had an acquisition, you've got big plans for the future. What's your advice for other creators slash indie hackers, people who want to make content or community and actually make a living for it online? What's something they can take away from your story?

Jay Clouse: 45m 24s

I think taking relentless action. I don't think that I did anything special. I feel like every single day of my creator business has just been a struggle, honestly. It just feels like this is all going so slowly. I look at other people around me, it's like, oh, they're doing one thing and they're doing it really well and they're going faster than me.

At the end of the day, progress compounds. If you show up every day and you put in the time and you work hard, you'll get to a goal line, maybe slower than some of your peers and that's okay. Not everybody can be the breakout success, but, if you expand the surface area of your luck, something's happened.

Courtland Allen: 46m 1s

Yeah. I like that. Can you let listeners know where they can go to find more about all the different things that you're doing, about what you're doing at SPI and your courses and your content and podcasts as well?

Jay Clouse: 46m 11s

Let’s go to Twitter, go to @jayclouse on Twitter. I'm also at jayclouse.com. Pretty easy to find if you search for me but would love to hear from you.

Courtland Allen: 46m 20s

Cool. I'll put some links to that in the show notes. Thanks again, Jay.