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Apr 24, 2017 · 24m · top-founders

639: Fastest Growing Canadian Software Company: $200k to $20M in Revenue from 2010 to 2015 with CEO Tobyn Sowden

Tobin Sowden · 11m spoken Nathan Latka · 9m spoken
0:00 / 0:00

gold bands on the timeline = statements, start to end. Hover to read, click to jump. CC turns on captions

In this episode of 'The Top', Nathan Latka interviews Tobin Sowden, CEO of Redbrick, examining how the company scaled from $200,000 to over $20 million in revenue by pivoting from desktop app distribution into incubating SaaS products like Deskmetrics and Shift.

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 45.1% of the talking time here. How this is scored →

Nathan as informed peer 4.2 Guest teaching 3.4 Guest disagreement 1.6 Nathan pushing back 2.8
05100:0010:0020:001:31–5:36 · Nathan as informed peer 4/10 Redbrick's Revenue Growth and National Profit Ranking Latka probes Redbrick's rapid revenue growth claims and questions whether the company was fundamentally just an ad agency. Sowden pushes back on the agency label, explaining their proprietary software distribution platform and SDK desktop-attribution capabilities.5:36–11:18 · Nathan as informed peer 5/10 Scaling Paid User Acquisition with Facebook Advertising Campaigns Latka unpacks Sowden's Facebook ad spend commitment and quickly calculates the conversion math on Shift's 20,000 installs and $20 pricing tier. Sowden outlines their acquisition funnel and explains the product strategy behind building on the Electron framework.11:18–14:58 · Nathan as informed peer 4/10 Desktop Application Strategy Versus Browser Extension Development Latka asks why Shift is a desktop application rather than a browser extension, and inquires about Redbrick's true core revenue driver. Sowden explains browser technical limitations and acknowledges that traditional software distribution still drives most revenue over Deskmetrics.14:58–18:02 · Nathan as informed peer 5/10 Deskmetrics Technical Capabilities and Hybrid Pricing Structure Latka drills into Deskmetrics' average contract values and monetization levers. Sowden details why pure user-tier pricing broke down due to event costs, prompting their shift to a hybrid user-and-event pricing model.18:03–21:41 · Nathan as informed peer 3/10 Mid-roll Sponsor: Acuity Scheduling Free Trial Promotion Segment features Latka's sponsor spot for Acuity Scheduling followed by the Famous Five rapid-fire questions and episode wrap-up. Sowden clarifies that he did ultimately earn a technical degree, correcting Latka's slight misunderstanding.1:31–5:36 · Guest teaching 4/10 Redbrick's Revenue Growth and National Profit Ranking Latka probes Redbrick's rapid revenue growth claims and questions whether the company was fundamentally just an ad agency. Sowden pushes back on the agency label, explaining their proprietary software distribution platform and SDK desktop-attribution capabilities.5:36–11:18 · Guest teaching 3/10 Scaling Paid User Acquisition with Facebook Advertising Campaigns Latka unpacks Sowden's Facebook ad spend commitment and quickly calculates the conversion math on Shift's 20,000 installs and $20 pricing tier. Sowden outlines their acquisition funnel and explains the product strategy behind building on the Electron framework.11:18–14:58 · Guest teaching 4/10 Desktop Application Strategy Versus Browser Extension Development Latka asks why Shift is a desktop application rather than a browser extension, and inquires about Redbrick's true core revenue driver. Sowden explains browser technical limitations and acknowledges that traditional software distribution still drives most revenue over Deskmetrics.14:58–18:02 · Guest teaching 4/10 Deskmetrics Technical Capabilities and Hybrid Pricing Structure Latka drills into Deskmetrics' average contract values and monetization levers. Sowden details why pure user-tier pricing broke down due to event costs, prompting their shift to a hybrid user-and-event pricing model.18:03–21:41 · Guest teaching 2/10 Mid-roll Sponsor: Acuity Scheduling Free Trial Promotion Segment features Latka's sponsor spot for Acuity Scheduling followed by the Famous Five rapid-fire questions and episode wrap-up. Sowden clarifies that he did ultimately earn a technical degree, correcting Latka's slight misunderstanding.1:31–5:36 · Guest disagreement 3/10 Redbrick's Revenue Growth and National Profit Ranking Latka probes Redbrick's rapid revenue growth claims and questions whether the company was fundamentally just an ad agency. Sowden pushes back on the agency label, explaining their proprietary software distribution platform and SDK desktop-attribution capabilities.5:36–11:18 · Guest disagreement 1/10 Scaling Paid User Acquisition with Facebook Advertising Campaigns Latka unpacks Sowden's Facebook ad spend commitment and quickly calculates the conversion math on Shift's 20,000 installs and $20 pricing tier. Sowden outlines their acquisition funnel and explains the product strategy behind building on the Electron framework.11:18–14:58 · Guest disagreement 2/10 Desktop Application Strategy Versus Browser Extension Development Latka asks why Shift is a desktop application rather than a browser extension, and inquires about Redbrick's true core revenue driver. Sowden explains browser technical limitations and acknowledges that traditional software distribution still drives most revenue over Deskmetrics.14:58–18:02 · Guest disagreement 1/10 Deskmetrics Technical Capabilities and Hybrid Pricing Structure Latka drills into Deskmetrics' average contract values and monetization levers. Sowden details why pure user-tier pricing broke down due to event costs, prompting their shift to a hybrid user-and-event pricing model.18:03–21:41 · Guest disagreement 1/10 Mid-roll Sponsor: Acuity Scheduling Free Trial Promotion Segment features Latka's sponsor spot for Acuity Scheduling followed by the Famous Five rapid-fire questions and episode wrap-up. Sowden clarifies that he did ultimately earn a technical degree, correcting Latka's slight misunderstanding.1:31–5:36 · Nathan pushing back 4/10 Redbrick's Revenue Growth and National Profit Ranking Latka probes Redbrick's rapid revenue growth claims and questions whether the company was fundamentally just an ad agency. Sowden pushes back on the agency label, explaining their proprietary software distribution platform and SDK desktop-attribution capabilities.5:36–11:18 · Nathan pushing back 3/10 Scaling Paid User Acquisition with Facebook Advertising Campaigns Latka unpacks Sowden's Facebook ad spend commitment and quickly calculates the conversion math on Shift's 20,000 installs and $20 pricing tier. Sowden outlines their acquisition funnel and explains the product strategy behind building on the Electron framework.11:18–14:58 · Nathan pushing back 3/10 Desktop Application Strategy Versus Browser Extension Development Latka asks why Shift is a desktop application rather than a browser extension, and inquires about Redbrick's true core revenue driver. Sowden explains browser technical limitations and acknowledges that traditional software distribution still drives most revenue over Deskmetrics.14:58–18:02 · Nathan pushing back 3/10 Deskmetrics Technical Capabilities and Hybrid Pricing Structure Latka drills into Deskmetrics' average contract values and monetization levers. Sowden details why pure user-tier pricing broke down due to event costs, prompting their shift to a hybrid user-and-event pricing model.18:03–21:41 · Nathan pushing back 1/10 Mid-roll Sponsor: Acuity Scheduling Free Trial Promotion Segment features Latka's sponsor spot for Acuity Scheduling followed by the Famous Five rapid-fire questions and episode wrap-up. Sowden clarifies that he did ultimately earn a technical degree, correcting Latka's slight misunderstanding.

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

0:00 · Nathan 74.4% · guest 25.6%0:00 · Nathan 74.4% · guest 25.6%3:00 · Nathan 25.8% · guest 74.2%3:00 · Nathan 25.8% · guest 74.2%6:00 · Nathan 16.3% · guest 83.7%6:00 · Nathan 16.3% · guest 83.7%9:00 · Nathan 33.2% · guest 66.8%9:00 · Nathan 33.2% · guest 66.8%12:00 · Nathan 16.4% · guest 83.6%12:00 · Nathan 16.4% · guest 83.6%15:00 · Nathan 20.4% · guest 79.6%15:00 · Nathan 20.4% · guest 79.6%18:00 · Nathan 72.3% · guest 27.7%18:00 · Nathan 72.3% · guest 27.7%21:00 · Nathan 99.7% · guest 0.3%21:00 · Nathan 99.7% · guest 0.3%24:00 · Nathan 100% · guest 0%24:00 · Nathan 100% · guest 0%
Sharpest disagreement ▶ 3:35 Rejecting the 'Ad Agency' Premise

Sowden immediately reframes Latka's suggestion that Redbrick was just an ad agency, clarifying that they built proprietary in-house software analytics and distribution technology.

 Hardest push from Nathan ▶ 6:48 Bracketing the Facebook Partnership Terms

Latka pushes past Sowden's vague 'commitment' phrasing to specifically define and bracket the spend requirement terms tied to Facebook's partner support.

 Biggest teaching moment ▶ 16:33 Why Unlimited Event Tracking Failed

Sowden breaks down SaaS pricing unit economics, educating the host on why charging purely per user without event limits resulted in high unmonetized infrastructure costs.

 Nathan holds their own ▶ 10:07 Instant Unit Economics and Launch Timing Critique

Latka calculates exact launch revenue from conversion percentages on the fly and questions the high-risk decision of launching five days before Christmas.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Redbrick's Revenue Growth and National Profit Ranking 4434 Latka probes Redbrick's rapid revenue growth claims and questions whether the company was fundamentally just an ad agency. Sowden pushes back on the agency label, explaining their proprietary software distribution platform and SDK desktop-attribution capabilities.
Scaling Paid User Acquisition with Facebook Advertising Campaigns 5313 Latka unpacks Sowden's Facebook ad spend commitment and quickly calculates the conversion math on Shift's 20,000 installs and $20 pricing tier. Sowden outlines their acquisition funnel and explains the product strategy behind building on the Electron framework.
Desktop Application Strategy Versus Browser Extension Development 4423 Latka asks why Shift is a desktop application rather than a browser extension, and inquires about Redbrick's true core revenue driver. Sowden explains browser technical limitations and acknowledges that traditional software distribution still drives most revenue over Deskmetrics.
Deskmetrics Technical Capabilities and Hybrid Pricing Structure 5413 Latka drills into Deskmetrics' average contract values and monetization levers. Sowden details why pure user-tier pricing broke down due to event costs, prompting their shift to a hybrid user-and-event pricing model.
Mid-roll Sponsor: Acuity Scheduling Free Trial Promotion 3211 Segment features Latka's sponsor spot for Acuity Scheduling followed by the Famous Five rapid-fire questions and episode wrap-up. Sowden clarifies that he did ultimately earn a technical degree, correcting Latka's slight misunderstanding.

Statements from this episode (9)

Assertion Supported
Sowden: Redbrick Grew Revenue from $200K to $10M–$20M from 2010 to 2015
“2010, and 200,000 in revenue, and then we were we were reported in the range of 10 to twenty million, as far as our final fiscal year in.”
Tobin Sowden Apr 24, 2017 ▶ 2:32
Disclosure
Sowden: Redbrick spends $30k monthly on Facebook, committed to $1M quarterly
“We are currently spending probably 30,000 dollars but we've got a commitment to grow to a million dollars in a quarter.”
Tobin Sowden Apr 24, 2017 ▶ 6:39
Disclosure
Sowden: Shift charges users $20 per year for SaaS access
“The business model is is simply, you know, software as a service, it's 20 dollars a year.”
Tobin Sowden Apr 24, 2017 ▶ 9:06
Assertion Not checkable as stated
Sowden: Shift has 10k weekly active users and a 4-5% conversion rate
“I think we've seen about 20,000 installs on any given day or week. I think we have, on any given week, we have about 10,000 active users. And our free, our kind of, our free to pay conversion rate is around the four to five percent mark right now.”
Tobin Sowden Apr 24, 2017 ▶ 9:48
Insight
Sowden: Browser session restrictions make multi-account email apps hard in-browser
“I think if you look at you know, the browser model, when it comes to how sessions work, it's not an easy thing to build the experience that we built with shift within the browser, just the technical restrictions on how browsers are built.”
Tobin Sowden Apr 24, 2017 ▶ 11:48
Disclosure
Sowden: Shift will focus on communication rather than becoming a browser
“As those, the number of integrations goes to infinity, our shift becomes a browser. So, so so I really want to avoid that and continue to make the focus of shift mostly on communication and a little bit of productivity as far as how it's linked to those primar…”
Tobin Sowden Apr 24, 2017 ▶ 12:43
Disclosure
Sowden: Redbrick is pivoting to SaaS due to distribution revenue volatility
“As much as we love that business and it has been very good to us around quickly over the years and helped us build what we have today. It's not it's not predictable. It's not consistent. We can we, you know, it's really hard to continue to grow a business when…”
Tobin Sowden Apr 24, 2017 ▶ 13:46
Assertion Not checkable as stated
Deskmetrics average customer pays around $500 per month
“I would say the average, you know, the average customer is probably paying us on to the tune of about 500 dollars. And then we've got you know. Annually Tobin or monthly? Monthly.”
Tobin Sowden Apr 24, 2017 ▶ 16:12
Insight
Sowden advises founders to get technical degrees and learn business by experience
“I think if I was to go back, I would tell myself technical all the way because learning business is a lot of fun. And I think there's a lot of value that comes with that process learned in the real world world as well.”
Tobin Sowden Apr 24, 2017 ▶ 20:39
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