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Jan 27, 2019 · 25m · top-founders

1282 With $12m in ARR, ConvertKit Makes Major Change Removing CC Trial, Will it work?

Nathan Berry · 12m spoken Nathan Latka · 9m spoken
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gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions

In this interview on The Top Entrepreneurs Podcast, Nathan Latka speaks with ConvertKit founder Nathan Berry about scaling the bootstrapped SaaS company past $12M ARR, overhauling user onboarding by removing upfront credit cards, and rebranding to Seva.

How this conversation actually went

Every chapter scored 0–10 on four independent dynamics. Hover any point for the reasoning behind the score. Nathan holds 41.9% of the talking time here. How this is scored →

Nathan as informed peer 5.8 Guest teaching 2.6 Guest disagreement 1.4 Nathan pushing back 2.4
05100:0010:0020:001:19–5:00 · Nathan as informed peer 5/10 Rebranding ConvertKit to Seva and Current Metrics Latka opens by verifying ConvertKit's public metrics including $1.07M MRR and churn rate. He demonstrates industry familiarity by accurately deducing how Berry's three-person webinar team divides responsibilities.5:00–11:25 · Nathan as informed peer 6/10 The High-Stakes Onboarding Shift: Removing Upfront Credit Cards Berry shares the high-stakes experiment of eliminating upfront credit cards despite it creating their worst growth month in June. Latka challenges the approach by raising the standard board-level objection regarding form drop-offs.11:29–16:32 · Nathan as informed peer 6/10 Sponsor Break: Asana Task Management Following an Asana sponsorship read, Latka probes how Berry manages onboarding variations and contextualizes the transition against patterns seen in other successful SaaS businesses.16:32–19:55 · Nathan as informed peer 6/10 Scaling a Remote Team and Open Metric Transparency Berry discusses remote team hiring and paid acquisition. Latka quickly calculates the CAC math from their $55 ARPU and 5-month payback threshold while distinguishing bootstrapped versus venture-backed mindsets.19:55–22:58 · Nathan as informed peer 6/10 Negotiating the Seva.com Domain Purchase Berry shares how he negotiated the purchase of Seva.com down from $500k to $310k cash upfront. Latka reinforces the strategic lesson on leverage derived from payment terms versus headline price.1:19–5:00 · Guest teaching 2/10 Rebranding ConvertKit to Seva and Current Metrics Latka opens by verifying ConvertKit's public metrics including $1.07M MRR and churn rate. He demonstrates industry familiarity by accurately deducing how Berry's three-person webinar team divides responsibilities.5:00–11:25 · Guest teaching 4/10 The High-Stakes Onboarding Shift: Removing Upfront Credit Cards Berry shares the high-stakes experiment of eliminating upfront credit cards despite it creating their worst growth month in June. Latka challenges the approach by raising the standard board-level objection regarding form drop-offs.11:29–16:32 · Guest teaching 2/10 Sponsor Break: Asana Task Management Following an Asana sponsorship read, Latka probes how Berry manages onboarding variations and contextualizes the transition against patterns seen in other successful SaaS businesses.16:32–19:55 · Guest teaching 2/10 Scaling a Remote Team and Open Metric Transparency Berry discusses remote team hiring and paid acquisition. Latka quickly calculates the CAC math from their $55 ARPU and 5-month payback threshold while distinguishing bootstrapped versus venture-backed mindsets.19:55–22:58 · Guest teaching 3/10 Negotiating the Seva.com Domain Purchase Berry shares how he negotiated the purchase of Seva.com down from $500k to $310k cash upfront. Latka reinforces the strategic lesson on leverage derived from payment terms versus headline price.1:19–5:00 · Guest disagreement 1/10 Rebranding ConvertKit to Seva and Current Metrics Latka opens by verifying ConvertKit's public metrics including $1.07M MRR and churn rate. He demonstrates industry familiarity by accurately deducing how Berry's three-person webinar team divides responsibilities.5:00–11:25 · Guest disagreement 2/10 The High-Stakes Onboarding Shift: Removing Upfront Credit Cards Berry shares the high-stakes experiment of eliminating upfront credit cards despite it creating their worst growth month in June. Latka challenges the approach by raising the standard board-level objection regarding form drop-offs.11:29–16:32 · Guest disagreement 1/10 Sponsor Break: Asana Task Management Following an Asana sponsorship read, Latka probes how Berry manages onboarding variations and contextualizes the transition against patterns seen in other successful SaaS businesses.16:32–19:55 · Guest disagreement 2/10 Scaling a Remote Team and Open Metric Transparency Berry discusses remote team hiring and paid acquisition. Latka quickly calculates the CAC math from their $55 ARPU and 5-month payback threshold while distinguishing bootstrapped versus venture-backed mindsets.19:55–22:58 · Guest disagreement 1/10 Negotiating the Seva.com Domain Purchase Berry shares how he negotiated the purchase of Seva.com down from $500k to $310k cash upfront. Latka reinforces the strategic lesson on leverage derived from payment terms versus headline price.1:19–5:00 · Nathan pushing back 1/10 Rebranding ConvertKit to Seva and Current Metrics Latka opens by verifying ConvertKit's public metrics including $1.07M MRR and churn rate. He demonstrates industry familiarity by accurately deducing how Berry's three-person webinar team divides responsibilities.5:00–11:25 · Nathan pushing back 4/10 The High-Stakes Onboarding Shift: Removing Upfront Credit Cards Berry shares the high-stakes experiment of eliminating upfront credit cards despite it creating their worst growth month in June. Latka challenges the approach by raising the standard board-level objection regarding form drop-offs.11:29–16:32 · Nathan pushing back 2/10 Sponsor Break: Asana Task Management Following an Asana sponsorship read, Latka probes how Berry manages onboarding variations and contextualizes the transition against patterns seen in other successful SaaS businesses.16:32–19:55 · Nathan pushing back 3/10 Scaling a Remote Team and Open Metric Transparency Berry discusses remote team hiring and paid acquisition. Latka quickly calculates the CAC math from their $55 ARPU and 5-month payback threshold while distinguishing bootstrapped versus venture-backed mindsets.19:55–22:58 · Nathan pushing back 2/10 Negotiating the Seva.com Domain Purchase Berry shares how he negotiated the purchase of Seva.com down from $500k to $310k cash upfront. Latka reinforces the strategic lesson on leverage derived from payment terms versus headline price.

speaking balance: gold is Nathan, purple is the guest (3 minute bins)

0:00 · Nathan 73.7% · guest 26.3%0:00 · Nathan 73.7% · guest 26.3%3:00 · Nathan 22.1% · guest 77.9%3:00 · Nathan 22.1% · guest 77.9%6:00 · Nathan 13.8% · guest 86.2%6:00 · Nathan 13.8% · guest 86.2%9:00 · Nathan 49.9% · guest 50.1%9:00 · Nathan 49.9% · guest 50.1%12:00 · Nathan 60.7% · guest 39.3%12:00 · Nathan 60.7% · guest 39.3%15:00 · Nathan 46.9% · guest 53.1%15:00 · Nathan 46.9% · guest 53.1%18:00 · Nathan 28.5% · guest 71.5%18:00 · Nathan 28.5% · guest 71.5%21:00 · Nathan 33% · guest 67%21:00 · Nathan 33% · guest 67%24:00 · Nathan 53.4% · guest 46.6%24:00 · Nathan 53.4% · guest 46.6%
Sharpest disagreement ▶ 8:52 Guest defends controversial onboarding changes despite revenue dip

Berry candidly reveals that removing the credit card led to their worst growth month ever, but firmly defends testing long-term cohort value over short-term conversion.

 Hardest push from Nathan ▶ 9:02 Host raises standard executive pushback against signup friction

Latka pushes back on Berry's strategy by articulating the counterargument that asking questions upfront causes drop-off before capturing contact information.

 Biggest teaching moment ▶ 7:20 Guest explains gradual engagement UX principles

Berry educates Latka on the user experience principle of gradual engagement, explaining why small low-friction choices increase user commitment before data entry.

 Nathan holds their own ▶ 18:21 Host calculates payback economics and bootstrap discipline

Latka swiftly computes the allowable CAC on a $55 ARPU model with a 5-month payback window and explains why VC-backed founders tolerate higher burn than bootstrappers.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Rebranding ConvertKit to Seva and Current Metrics 5211 Latka opens by verifying ConvertKit's public metrics including $1.07M MRR and churn rate. He demonstrates industry familiarity by accurately deducing how Berry's three-person webinar team divides responsibilities.
The High-Stakes Onboarding Shift: Removing Upfront Credit Cards 6424 Berry shares the high-stakes experiment of eliminating upfront credit cards despite it creating their worst growth month in June. Latka challenges the approach by raising the standard board-level objection regarding form drop-offs.
Sponsor Break: Asana Task Management 6212 Following an Asana sponsorship read, Latka probes how Berry manages onboarding variations and contextualizes the transition against patterns seen in other successful SaaS businesses.
Scaling a Remote Team and Open Metric Transparency 6223 Berry discusses remote team hiring and paid acquisition. Latka quickly calculates the CAC math from their $55 ARPU and 5-month payback threshold while distinguishing bootstrapped versus venture-backed mindsets.
Negotiating the Seva.com Domain Purchase 6312 Berry shares how he negotiated the purchase of Seva.com down from $500k to $310k cash upfront. Latka reinforces the strategic lesson on leverage derived from payment terms versus headline price.

Statements from this episode (14)

Disclosure
Berry: ConvertKit rebranded to Seva to avoid tech-sounding name
“So we changed the name from ConvertKit to Seva and Seva is a Sanskrit word and it means selfless service. And basically we're trying to build a much bigger brand and we didn't want to be, I guess, pigeonholed into a really techie sounding name.”
Nathan Berry Jan 27, 2019 ▶ 1:55
Assertion Not checkable as stated
Berry: ConvertKit Expansion Revenue Cuts Churn in Half But Misses Net Negative
“Expansion revenue definitely helps, but it hasn't been enough to get us to, you know, net negative churn, which is the ultimate goal. So it cuts our churn rate in half. But you know, we still have to drive a lot of new revenue.”
Nathan Berry Jan 27, 2019 ▶ 3:14
Assertion Not checkable as stated
Berry: ConvertKit Runs 15 Partner Webinars Monthly Driving 30 to 500 Trials
“Yeah, we tend to average 15 a month, and those range from really big ones with someone like Pat Flynn that will drive, you know, 500 trials or something like that, which is pretty substantial or we'll do smaller ones that will drive 30, 40 trials and that's st…”
Nathan Berry Jan 27, 2019 ▶ 4:13
Assertion Not checkable as stated
ConvertKit converted 52% to 55% of upfront credit card trials to paid
“We were running about a 52 to 55% trial of paid conversion rate with credit card up front.”
Nathan Berry Jan 27, 2019 ▶ 5:49
Assertion Not checkable as stated
ConvertKit recorded its worst growth month ever after removing upfront credit cards
“It's been live for about a month and a half and we've had our worst month of growth ever in June.”
Nathan Berry Jan 27, 2019 ▶ 8:54
Insight
Berry: Asking questions during onboarding does not decrease signup completion
“Asking the questions will not decrease the number of people that make it from you know, account signup page to create an account.”
Nathan Berry Jan 27, 2019 ▶ 9:43
Assertion Not checkable as stated
ConvertKit hit a record 5,200 monthly trials after dropping upfront credit cards
“I think the month of June, we're at 5200 trials. So that's substantial way better. I think our best month ever before that was in the 3000 range.”
Nathan Berry Jan 27, 2019 ▶ 10:31
Assertion Not checkable as stated
Berry: ConvertKit alerts demo team for leads over 5k subscribers
“If you put in, you have over 5000 subscribers, then that alerts our demo team and it tries to get you to schedule a demo.”
Nathan Berry Jan 27, 2019 ▶ 13:34
Insight
Berry: ConvertKit shifts activation metrics based on user list size
“If in signup, they said they have 2000 subscribers. Now we know that our single goal is to get them to import those subscribers. And so it can totally change the activation metrics based on who they are.”
Nathan Berry Jan 27, 2019 ▶ 16:16
Disclosure
Berry: ConvertKit spends $20K to $25K monthly on paid advertising
“We do some, I think our paid ad ads budgets is about 20 to 25,000 a month.”
Nathan Berry Jan 27, 2019 ▶ 17:57
Disclosure
Berry: ConvertKit targets a 3 to 5 month payback period on CAC
“We've been targeting a three to five month payback period.”
Nathan Berry Jan 27, 2019 ▶ 18:09
Disclosure
Berry: ConvertKit is not considering raising venture capital
“I'm not considering raising capital.”
Nathan Berry Jan 27, 2019 ▶ 19:01
Disclosure
Nathan Berry plans to run ConvertKit for 10 to 15 years
“I want to be running SEVA for the next 1015 years.”
Nathan Berry Jan 27, 2019 ▶ 19:44
Disclosure
Berry: ConvertKit paid $310,000 to purchase Seva.com domain
“I bought it about two and a half months ago. And Yeah, we paid 310,000 dollars for it.”
Nathan Berry Jan 27, 2019 ▶ 20:12
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