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Oct 24, 2016 · 18m · top-founders

EP 457: 4000+ Units Sold Teaching Kids How To Code, $2m+ Raised with Piper

Nathan Latka · 8m spoken Tommy Gibbons · 7m 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 episode 457 of The Top, host Nathan Latka interviews Tommy Gibbons of Piper to explore how the educational hardware startup raised $2.3 million, achieved 60% to 70% gross margins, and scaled sales of hands-on Raspberry Pi computer kits for kids.

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 51.3% of the talking time here. How this is scored →

Nathan as informed peer 4.2 Guest teaching 1.6 Guest disagreement 0.8 Nathan pushing back 1.8
05100:0010:001:08–4:16 · Nathan as informed peer 3/10 Introducing Tommy Gibbons and the Piper Computer Kit Latka asks standard introductory questions about Piper's product concept, pricing, and founding story. Gibbons shares an amusing operational anecdote regarding Craigslist and TaskRabbit fulfillment workers.4:16–8:16 · Nathan as informed peer 4/10 Funding, Co-Founders, and Earning Equity as an Early Hire Latka probes into the company's funding structure and asks if the seed round was priced or a convertible note, prompting Gibbons to defer to his CEO. Latka also inquires about Gibbons' compensation and equity journey as an early employee.8:16–11:46 · Nathan as informed peer 6/10 Company Growth, Team Size, and Silicon Valley Office Life Latka ribs Gibbons about living in the Silicon Valley bubble before pressing him for unit economics. When Gibbons hesitates to disclose COGS due to competitors, Latka pushes him to provide an approximate range and calculates the gross margins.11:46–14:01 · Nathan as informed peer 6/10 Sales Baseline Growth and 2016 Holiday Forecasts Latka mathematically synthesizes Gibbons' monthly unit sales baseline into a holiday multiplier model to forecast late 2016 volume targets.14:02–15:27 · Nathan as informed peer 2/10 Sponsor Message: HostGator Website Hosting Platform Segment includes a mid-roll sponsor read for HostGator followed by a brief discussion of Piper's email newsletter list and digital retargeting.1:08–4:16 · Guest teaching 2/10 Introducing Tommy Gibbons and the Piper Computer Kit Latka asks standard introductory questions about Piper's product concept, pricing, and founding story. Gibbons shares an amusing operational anecdote regarding Craigslist and TaskRabbit fulfillment workers.4:16–8:16 · Guest teaching 2/10 Funding, Co-Founders, and Earning Equity as an Early Hire Latka probes into the company's funding structure and asks if the seed round was priced or a convertible note, prompting Gibbons to defer to his CEO. Latka also inquires about Gibbons' compensation and equity journey as an early employee.8:16–11:46 · Guest teaching 2/10 Company Growth, Team Size, and Silicon Valley Office Life Latka ribs Gibbons about living in the Silicon Valley bubble before pressing him for unit economics. When Gibbons hesitates to disclose COGS due to competitors, Latka pushes him to provide an approximate range and calculates the gross margins.11:46–14:01 · Guest teaching 1/10 Sales Baseline Growth and 2016 Holiday Forecasts Latka mathematically synthesizes Gibbons' monthly unit sales baseline into a holiday multiplier model to forecast late 2016 volume targets.14:02–15:27 · Guest teaching 1/10 Sponsor Message: HostGator Website Hosting Platform Segment includes a mid-roll sponsor read for HostGator followed by a brief discussion of Piper's email newsletter list and digital retargeting.1:08–4:16 · Guest disagreement 1/10 Introducing Tommy Gibbons and the Piper Computer Kit Latka asks standard introductory questions about Piper's product concept, pricing, and founding story. Gibbons shares an amusing operational anecdote regarding Craigslist and TaskRabbit fulfillment workers.4:16–8:16 · Guest disagreement 1/10 Funding, Co-Founders, and Earning Equity as an Early Hire Latka probes into the company's funding structure and asks if the seed round was priced or a convertible note, prompting Gibbons to defer to his CEO. Latka also inquires about Gibbons' compensation and equity journey as an early employee.8:16–11:46 · Guest disagreement 2/10 Company Growth, Team Size, and Silicon Valley Office Life Latka ribs Gibbons about living in the Silicon Valley bubble before pressing him for unit economics. When Gibbons hesitates to disclose COGS due to competitors, Latka pushes him to provide an approximate range and calculates the gross margins.11:46–14:01 · Guest disagreement 0/10 Sales Baseline Growth and 2016 Holiday Forecasts Latka mathematically synthesizes Gibbons' monthly unit sales baseline into a holiday multiplier model to forecast late 2016 volume targets.14:02–15:27 · Guest disagreement 0/10 Sponsor Message: HostGator Website Hosting Platform Segment includes a mid-roll sponsor read for HostGator followed by a brief discussion of Piper's email newsletter list and digital retargeting.1:08–4:16 · Nathan pushing back 1/10 Introducing Tommy Gibbons and the Piper Computer Kit Latka asks standard introductory questions about Piper's product concept, pricing, and founding story. Gibbons shares an amusing operational anecdote regarding Craigslist and TaskRabbit fulfillment workers.4:16–8:16 · Nathan pushing back 3/10 Funding, Co-Founders, and Earning Equity as an Early Hire Latka probes into the company's funding structure and asks if the seed round was priced or a convertible note, prompting Gibbons to defer to his CEO. Latka also inquires about Gibbons' compensation and equity journey as an early employee.8:16–11:46 · Nathan pushing back 4/10 Company Growth, Team Size, and Silicon Valley Office Life Latka ribs Gibbons about living in the Silicon Valley bubble before pressing him for unit economics. When Gibbons hesitates to disclose COGS due to competitors, Latka pushes him to provide an approximate range and calculates the gross margins.11:46–14:01 · Nathan pushing back 1/10 Sales Baseline Growth and 2016 Holiday Forecasts Latka mathematically synthesizes Gibbons' monthly unit sales baseline into a holiday multiplier model to forecast late 2016 volume targets.14:02–15:27 · Nathan pushing back 0/10 Sponsor Message: HostGator Website Hosting Platform Segment includes a mid-roll sponsor read for HostGator followed by a brief discussion of Piper's email newsletter list and digital retargeting.

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

0:00 · Nathan 64.4% · guest 35.6%0:00 · Nathan 64.4% · guest 35.6%3:00 · Nathan 18.8% · guest 81.2%3:00 · Nathan 18.8% · guest 81.2%6:00 · Nathan 40.6% · guest 59.4%6:00 · Nathan 40.6% · guest 59.4%9:00 · Nathan 37.4% · guest 62.6%9:00 · Nathan 37.4% · guest 62.6%12:00 · Nathan 62.5% · guest 37.5%12:00 · Nathan 62.5% · guest 37.5%15:00 · Nathan 84.2% · guest 15.8%15:00 · Nathan 84.2% · guest 15.8%18:00 · Nathan 100% · guest 0%18:00 · Nathan 100% · guest 0%
Sharpest disagreement ▶ 9:31 Guest hesitates on disclosing COGS

Gibbons resists answering Latka's financial question directly, noting that competitors might be listening to the podcast.

 Hardest push from Nathan ▶ 9:29 Host insists on COGS numbers

Latka refuses to allow Gibbons to withhold unit cost data and demands an acceptable estimate range.

 Biggest teaching moment ▶ 3:46 Guest explains warehouse labor dynamics

Gibbons educates Latka on the grassroots logistics of early fulfillment and the unexpected pay discrepancy strike between TaskRabbit and Craigslist hires.

 Nathan holds their own ▶ 12:28 Host calculates unit sales multiplier

Latka demonstrates his financial acumen by breaking down monthly run rates and calculating Piper's expected holiday revenue trajectory in real time.
the scores for every segment, with the reasoning behind each
ChapterTopicNathan as informed peerGuest teachingGuest disagreementNathan pushing backWhy
Introducing Tommy Gibbons and the Piper Computer Kit 3211 Latka asks standard introductory questions about Piper's product concept, pricing, and founding story. Gibbons shares an amusing operational anecdote regarding Craigslist and TaskRabbit fulfillment workers.
Funding, Co-Founders, and Earning Equity as an Early Hire 4213 Latka probes into the company's funding structure and asks if the seed round was priced or a convertible note, prompting Gibbons to defer to his CEO. Latka also inquires about Gibbons' compensation and equity journey as an early employee.
Company Growth, Team Size, and Silicon Valley Office Life 6224 Latka ribs Gibbons about living in the Silicon Valley bubble before pressing him for unit economics. When Gibbons hesitates to disclose COGS due to competitors, Latka pushes him to provide an approximate range and calculates the gross margins.
Sales Baseline Growth and 2016 Holiday Forecasts 6101 Latka mathematically synthesizes Gibbons' monthly unit sales baseline into a holiday multiplier model to forecast late 2016 volume targets.
Sponsor Message: HostGator Website Hosting Platform 2100 Segment includes a mid-roll sponsor read for HostGator followed by a brief discussion of Piper's email newsletter list and digital retargeting.

Statements from this episode (9)

Assertion Not checkable as stated
Piper Has Reached Over 4,000 Customers Since Launch
“And then we already have over 4000 customers since launching Christmas last year.”
Tommy Gibbons Oct 24, 2016 ▶ 2:15
Assertion Supported
Piper raises over $200,000 on Kickstarter in spring 2015
“So we were one of the most successful Kickstarters of that of that quarter raised over 200,000 dollars from there.”
Tommy Gibbons Oct 24, 2016 ▶ 2:58
Assertion Supported
Piper raised a $2.1M seed round in addition to Kickstarter capital
“We have a 2.1 million in our seed round. So that is X to 250 from Kickstarter.”
Tommy Gibbons Oct 24, 2016 ▶ 4:23
Assertion Not checkable as stated
Gibbons: Piper has 10 employees
“We are 10 employees.”
Tommy Gibbons Oct 24, 2016 ▶ 8:18
Assertion Not checkable as stated
Gibbons: Piper's COGS ranges between $100 and $115 per unit
“We're talking between one and one 15.”
Tommy Gibbons Oct 24, 2016 ▶ 9:36
Assertion Not checkable as stated
Gibbons: Piper's Facebook ad CAC ranges from $25 to $65
“When we're just doing straight Facebook ads it depends on seasonality. Sometimes we see 25 dollars and sometimes we see 65 dollars.”
Tommy Gibbons Oct 24, 2016 ▶ 10:00
Assertion Not checkable as stated
Gibbons: Piper resellers buy units at $240 and retail at $299
“Our resellers are willing to take a It's a pretty slim cut of margin. So we're talking like two 40 apiece, reselling at two 99.”
Tommy Gibbons Oct 24, 2016 ▶ 10:23
Assertion Not checkable as stated
Piper sold over 400 units in July and nearly 500 in August 2016
“So we did a little over 400 in July, just under 500 in August. And then as September, it looks like we'll be over 600 here.”
Tommy Gibbons Oct 24, 2016 ▶ 13:00
Assertion Not checkable as stated
Gibbons: Piper has an email list of probably over 12,000
“I mean, we've got an email list of probably over 12,000.”
Tommy Gibbons Oct 24, 2016 ▶ 14:49
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