The Unofficial Shopify Podcast: Entrepreneur Tales

Automating Real UGC on TikTok

Episode Summary

w/ Abe Wolke, Bounty

Episode Notes

How a 12-month-old platform, Bounty, is merging influencers and loyalty for efficient customer acquisition

GUEST BIO: Abe started Bounty in November 2021 following Apple’s iOS 14.5 privacy updates that turned the advertising industry upside down. He previously co-founded two direct to consumer brands, but due to the product categories, couldn’t run Facebook ads. Instead, he focused on working with influencers and creators to drive growth. When the privacy updates drove digital advertising to an inflection point, Abraham leveraged his learnings in the new advertising landscape to create a new scalable channel to help brands drive growth.

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Episode Transcription

The Unofficial Shopify Podcast
11-1-2022

Kurt Elster: So, earlier in the summer I was in LA for E-Commerce Day, and it’s this big eCommerce conference. I spoke at it. And you definitely, when you get that many people in the same industry together, presenting their experiences and telling their stories on stage and off in the hallways, you start to notice themes and recurring things amongst conversations. And between friends, and on stage, and in these fireside chats, and in the hallway, one of the things… The definite trend and theme I was hearing was TikTok, the death of Facebook, UGC being more important than ever, and a few tools would come up mentioned repeatedly in relation to those things. And there was one that caught my interest that I heard a lot of people I really respected being like, “Have you heard of this thing? This looks interesting.” And it was called Bounty.

And I looked at Bounty and it’s this tool that somehow is gonna merge the concept of influencers, and loyalty, and customer acquisition, and let’s throw TikTok in there. It hit all the right buzzwords. And then I noticed Sugar Capital invested in this thing and I went, “All right, you know what? This is one of the things where I gotta know more.” And so, I was able to get the founder, Abe Wolke, to join us on the show and explain it to me. So, I’m gonna learn about it in real time with you, my friends. That’s what we’re talking about today. We are gonna learn about Bounty, a new app that promises to help you undo some of that lost return on ad spend from your Facebook campaigns. But how is it gonna do it?

Anyway, let’s figure it out together. I’m your host, Kurt Elster.

Ezra Firestone Sound Board Clip: Tech Nasty!

Kurt Elster: And this is The Unofficial Shopify Podcast. Abe, thank you for joining us.

Abe Wolke: Yeah. Thanks for having me, Kurt. I’m excited to be here.

Kurt Elster: Oh, my pleasure. Well, you know what? I want to know, what’s the difference between a creator and an influencer? So, you are now… I’m just like a dad, I got my gray hairs, I’m pushing 40. I don’t know what’s what anymore. I have no idea what’s going on. The kids with their TikToks. My kids are exclusively on TikTok. But then I just heard that we have rebranded influencers as creators. I don’t know what’s going on. So, let’s start there. What’s the difference between a creator and an influencer?

Abe Wolke: The thing to know about influencers is that when you work with an influencer you’re paying for their influence, so you’re paying for access to their audience, right? And these people who follow them and want their recommendations and want to know about all the things they do and the way they live and aspire to be like them, right? And creator I think is just a much broader term that encompasses influencers and everyone else who creates content. So, when brands work with influencers they’re looking for a very specific thing, but that’s just one thing that as a brand you need, and that’s reach to a specific audience.

But brands also need creative assets. They need content for ads. They need a lot of other things. And so, as they start branching out for where do we get these other things, a lot of times they’ll start working with creators, right? And when you’re working with a creator they could be an influencer, but you’re not necessarily there for their audience. You really want the creative assets that they can generate for you a lot of the time. And maybe you want them to post.

But I would say creator is just a broader term, right? So, it encompasses anyone that’s creating content, whether that is published on social media or not.

Kurt Elster: Okay. I love that description. That really does… I just thought we had taken the phrase influencer and we were like, “You know what? That one’s not feeling so hot. It’s getting a little stale. We’re just gonna rebrand that.” No, not the case. So, in my Venn diagram, influencer fits within creator. My wife always says, “Hey, if you’re gonna start, build any kind of audience, a brand, anything, just be prepared to yell into the void for 12 months with no one listening.” Those people are the creators. And then two years later, whoa, now I’ve got an audience. Okay, now I’m approaching influencer status. And you know, audience of 10,000, micro influencer, et cetera.

But you know, with mobile dominating everything, and connections and devices getting faster, now suddenly video is the whole ballgame, and portrait video specifically, because I hold my phone like this, straight up and down. And it’s tough to create video, especially when you’re not used to it, and tough to create these hyper engaging short videos, and so getting access to an entire cottage industry of people, that’s what creators are. They’re people who are really good at their phone video, their portrait video at home most of the time. That feels… Well, A, it’s engaging content. It works for ads. It’s authentic. It feels good. I like it.

So, this is why I’m so interested in this concept, is because what I’m hearing is like I think I’m gonna get access to that. And so, I’m definitely a believer in this kind of content, but is this user-generated content? Like when we say UGC, user-generated content, what are we talking about there?

Abe Wolke: Yeah. So, I think of it as a spectrum, right? And on one side of the spectrum, you have influencers, and let’s call this the spectrum of authenticity, right? So, on one side you have influencers-

Kurt Elster: I love that.

Abe Wolke: … and on the other side you have customers. And then I would say UGC right now in most cases falls somewhere in the middle of the spectrum because a lot of times what people call user-generated content is not actually user-generated content. It’s a creator who is acting as a user of the product because they’re getting paid to create these assets. And it comes across and people sell it as user-generated content, but did that creator really go out and purchase the product themselves and create that video? Or were they contracted by the brand and that’s why they’re doing it? So, I would say influencer marketing, obviously people are much more aware that all of these people are getting paid and a lot of times they wouldn’t go out and buy the products themselves, and it’s a career path now, and so I would put it on the spectrum of authenticity on like the least authentic side, and then as you move down the spectrum you have UGC, or some people talk about IGC, which is influencer-generated content, and then you have UGC, which is user-generated content, but customers are already catching on to the fact that a lot of that UGC is created by the same few faces for all these different brands, and they can’t possibly be the real customers of all these different brands that are advertising to me. And so, that’s something consumers and customers have caught onto.

And then at the far end of the spectrum, which is basically what Bounty has done, is just jumped all the way to the far end of the spectrum and said, “Hey, let’s work with the real customers.” The people who actually buy the products. And a lot of times these customers are already sharing products they love, but they can generate a ton of value for these brands, and they rarely capture any of that value, and when I say rarely I mean never. And so, at Bounty what we’re focused on is really helping the real customers who actually buy products, and use products, and love these products, capture some of that value they generate when they share their experiences on social media.

Kurt Elster: Okay, so that’s a good opportunity to tell me how does Bounty fit into this picture. What is this thing?

Abe Wolke: Yeah, so I’ll start with kind of what everything else is and then I’ll talk about what Bounty is, so if we’re talking about scaling micro and nano influencers specifically, because that’s where the ROI is if you’re a brand, right? If you’re paying for macro influencers, they’re charging you a premium for their brand image. They think that they’re a celebrity of sorts and they kind of are, but you’re just not gonna generate a return.

Kurt Elster: They’re internet famous. That’s not regular famous.

Abe Wolke: They’re internet famous. No, it’s a different kind of famous, a new kind of famous. But yeah, so-

Kurt Elster: Means you get a lot of spam. Well, actually, define for me before you go forward, just define the audience ranges for nano, micro, macro.

Abe Wolke: You know, I don’t have an exact number, but-

Kurt Elster: You can ballpark it. Come on. You know.

Abe Wolke: Yeah. Okay. Okay. Macro I would say is over 100,000. Micro is under 100,000. And nano would be under 10,000, I would say. Maybe under 5,000.

Kurt Elster: Ooh. Okay, so by that one I’m in micro. I’m like firmly in micro. Sweet.

Abe Wolke: It’s the good micro to be in.

Kurt Elster: Okay. Continue.

Abe Wolke: Yeah. So, the macro influencers charge. They charge a lot. You’re not gonna generate positive ROI, especially as like a direct-to-consumer business who’s actually tracking their return on ad spend and all these things. Bigger companies, big conglomerates can just pay for eyeballs. They’re at that point. They’ll work with these big influencers. But the ROI for these direct-to-consumer brands is really in the micro and the nano influencers who have much higher engagement. Their audience is much less diverse in a good way, so if they post about your product you’re speaking and reaching a very specific audience where the bigger an influencer gets, the more widespread their audience is, and so the less targeted that audience is.

And so, the smaller you go, the more targeted that audience is, and so that’s where the ROI is for these brands.

Kurt Elster: I get the idea, so all right, recapping that a little bit, we’ve got these three categories of influencer, and if you’ve not worked with one, the thing to know, and I think the mistake a lot of people make and that I had made was the huge ones, 100,000 plus, those audiences just… They get more general. They’re following a person more about just their personality than anything else, versus the smaller ones definitely… There’s riches in niches. The micro and nano, it tends to be about a specific interest. And so, counterintuitively the smaller ones are often significantly more effective to work with than the larger ones.

Okay, so where… We’ve got all our pieces defined here. Where and how does Bounty fit into this?

Abe Wolke: Yeah, so Bounty is very much focused on unlocking the longtail of influencer marketing, so the micro and the nano creators, and the thing you need to know about these creators is they’re already shopping online, right? They love trying new products. They love being the first ones to share something, and find it, and share it with their audience, and so what Bounty does that’s fundamentally different than everyone else who’s tried to attack this micro and nano influencer space and help brands scale that as a channel is we have a placement on storefronts. So, we have a Shopify app. You install our Shopify app on your store. We have what we call customer experiences which could be on the product page, on the thank you page after purchase, or a dedicated landing page, or in your emails, and what they do is they let people who are already shopping on your website, so we know that they have this genuine interest in your product, it lets them self-identify as being interested in creating content for your brand.

So, they’re shopping a website, they make a purchase. On the thank you page, they see something that’s like, “Post on TikTok and get paid.” And they’re like, “Oh. I have a TikTok account. I like to make content. And I just bought this product, so I’m genuinely interested in it.” And if they click sign up, then once their order arrives we’ll send them a text message and be like, “Hey, your order from Store XYZ just arrived. You now have seven days to post on TikTok and get paid.” And they’ll click a link. It takes them through the browser. They log in with their TikTok account and then we take them through a flow. They’ll post. We’ll track the engagement. We’ll pay them out based on the reach they generate for the brand.

And so, what this means is we’re kind of flipping the whole influencer marketing thing on its head. We’re saying we don’t want to just spray and pray and send out a ton of free product to creators, and hope that they post, and hope that their audience cares, and hope that there’s some ROI there. We want to turn the visitors that are already on your website and already are inherently genuinely interested in your brand into creators for your brand. And when you do that, what you get is the most authentic content, right? Because these people aren’t in it for a free product. They’re not posting. They’re not like, “Oh yeah, I never heard of this but you’re sending it to me for free, so yeah, sure. I’ll post about it because I got it for free and it’s cool.” But they actually spent their own money, right? They have real skin in the game. And they were already on the website even before they knew that Bounty was a thing or an option.

And so, you just get this much more genuine level of content, and those people could have… We’ve had creators sign up who have four million, two million, one million followers. They are sometimes macro influencers by definition. But a lot of times they are much smaller micro and nano creators, and sometimes someone will sign up and make an incredible piece of content and it’s their first piece of content they’ve ever posted on TikTok, which is really cool because we’ll just see that we’re really allowing anybody to participate. And because TikTok will serve content to the audiences it resonates with, it’s not… You don’t have to have a big audience to participate. It’s really about the quality of the content that you can create.

And so, that’s really what Bounty does. We sit on a storefront. We allow visitors on the website to self-identify as content creators, as being interested in creating content for a brand, and then we handle that whole process after they receive their product to help them post a fun and creative video about the product, and then pay them out based on the reach that they generate, help them capture some of that value that they’re creating for the brand. So, the other important distinction that I would make is that we don’t gatekeep, so we don’t decide who gets to be a creator and who doesn’t, which is what a lot of these other platforms will do. So, you have to apply, and then they approve you.

Because we’re paying you out based on performance, anybody who is a customer of the product can participate or a customer of the brand can participate, which means that we can help creators be discovered. We can help people get a start as a creator. And you know, that’s just another difference that I think is important to highlight, because we’re letting anyone participate.

Kurt Elster: All right. This is… I think that’s like the fundamental difference and the real magic here. I love this. All right, let me think through this as an example to kind of recap this. All right, so my oldest kid, Silas and I, Silas and I are into retro gaming, and I’ve got this whole arcade machine in our house that I restored. My last purchases are arcade parts from Shopify stores. I literally will search for part numbers and then in quotes I write “powered by Shopify” and then that way I only find Shopify stores in my searches. It’s a cool trick.

And it’s mostly because I like to use Apple Pay. I just get in and out. I’m done. And I gotta support the mothership. We’re gonna build a joystick, like a little control USB panel for his computer with joysticks and buttons. I got all the parts coming. And it’s from a Shopify store. So, let’s say it shows up and then I get an email from the store that’s generated through Bounty, let’s say they’ve installed this thing. I don’t know what the integration looks like. And the email says, “Hey, you got your thing. We invite you to post about it on TikTok and potentially get paid for it.” And then Silas, my oldest, who is on TikTok all day, immediately now he’s got an idea. He knows what he’s gonna do and makes a cool video about… I don’t know, he does it’s sped up or it’s time lapse, where he assembles this joystick, and then you see him playing it. Like 30 seconds, it looks awesome, and it gets… You put it on TikTok. Hashtag it. The algorithm loves it. And then I get paid out by you?

And then me, as the merchant, I didn’t have to do anything. I’m getting eyeballs. I’m getting impressions, engagement. I’ve got this content. And this person gets rewarded for it potentially. It seems like it’s really no risk for everybody.

Abe Wolke: Yeah. I mean, that’s fundamentally the idea.

Kurt Elster: Is that how it works?

Abe Wolke: Yeah. That’s exactly how it works. So-

Kurt Elster: This sounds awesome.

Abe Wolke: Essentially, if the post performs then they get paid out, and if the post doesn’t perform, then they won’t get paid out as much. The other thing I’ll add is sometimes there’s a great piece of content that just doesn’t get picked up by the algorithm and so obviously you still want those-

Kurt Elster: Oh, the worst.

Abe Wolke: … creators to be incentivized, right? And so, the other thing we do at Bounty is we automatically save all of that content into a library that’s available to the brand. They can sort it. They can favorite it, tag it, things like this, and then they can also through the app request Spark codes. They can purchase usage rights and things like that. So, every time that content provides incremental value to the brand, the creator gets a piece, and so we’re facilitating all that on behalf of the creator.

So, as an example, say your content doesn’t… It gets 500 views, right? You get $5 on most of the brands on our platform. So, you get $5, that’s not a ton of money, but you put a lot of effort into this video, and it just doesn’t get a lot of views. Well, the brand could see that video in their content library and they’re like, “Yeah, this is a great video. I want to run this as a Spark ad. I want to show it to more people.” And they can just click request Spark code, they can make you an offer, maybe leave a little note, press send. We’re gonna text you again and be like, “Hey, this brand wants to use your content for 30 days. Unlock X amount in your wallet when you copy and paste this code back to us.” We’ll show them a video of exactly how to retrieve that Spark code and then they deliver it through the app. We pass that to the brand.

And now you’ve been able to earn more money off of that original post because it provided the brand more value. And so, as an example, we’ve had creators who’ve earned $12 on their original post. They didn’t get a ton of reach. They had only 1,500 or so followers and it just really didn’t get served to that many people. But the brand turned around and licensed it for 30 days for $100 and they spent 50 bucks on their order. So, now they’ve earned $112 as a nano creator who never would have had the opportunity to work with this brand before, so obviously they’re psyched. The brand is psyched because they just got a great piece of content from a real customer. And it cost them a lot less than working with a professional creator and they didn’t have to pay in advance. They only paid after they knew that it was a great piece of content that they wanted to use.

Kurt Elster: So, it’s kind of an interesting thing that we’re seeing happen is because Facebook and IG ads, I just want to call the Meta ads, but I don’t think anyone does that yet. FB and IG ads.

Abe Wolke: Yeah. I’ve never done it.

Kurt Elster: Yeah, see?

Abe Wolke: But it does make sense.

Kurt Elster: Doesn’t it? So, I’m making the call right now. Meta ads. So, with Meta ads, in response to declining return on ad spend with Meta ads, and truthfully it’s gotten better. It’s not where it was and what people wanted. But it is, 100% it’s harder. In response to that difficulty, money seeks return on investment, and so people started looking elsewhere, and TikTok is huge and the hot thing, and so they start looking to TikTok. What’s interesting is we’ve found videos that are successful on TikTok, regardless of their source, whether the brand creates it, an influencer, a creator, if it does well there it will probably do well as a portrait ad, a story video ad on Facebook, as a Meta ad. That’s cool.

So, it sounds like in the Bounty system the person who creates the video, the creator owns it. But then as the brand I can license it from them to use it as ads in other placements.

Abe Wolke: Right. That’s correct.

Kurt Elster: All right, I got that. I love that. Who pays here? The merchant is paying the creator?

Abe Wolke: Yeah, so the merchant, I mean the merchant pays Bounty who pays the creator. We’re essentially the trusted third party in the middle so that we can pay them after the fact.

Kurt Elster: You’re acting as escrow.

Abe Wolke: Yeah. Exactly. And we track that they purchased, and that their order was delivered, and then they post, and all these things. But ultimately, yeah, the creator is getting paid, the brand is paying us for the service. We’re never taking a cut from what the creator is getting paid out. They always get 100% of what they see that they’re gonna earn. It's you’re gonna get this much and that’s how much they get. When they go to withdraw that money, they keep it all. It’s not like, “Hey, Bounty is taking their 20% agency fee.” No, all of the fees are exposed on the brand side.

Kurt Elster: And so, what do those payouts, those earnings look like? If a program is really successful, how much is this gonna cost me?

Abe Wolke: Right. So-

Kurt Elster: In theory, I’m making all this back, but what’s my upfront cost here?

Abe Wolke: Yeah, so as a brand you get to set the total budget that you’re comfortable spending in a month, so say you set that budget at $5,000. And what happens is we have a soft limit where when you get to 75% of that budget, we’ll start to throttle the service, meaning we’re going to not display the widget on your website. We’re going to basically slow down the amount of people who are signing up and posting. And then once you hit that budget, you’ll never be billed more than that budget that you set. We’ll just tell the creators, “Hey, this brand’s at their budget. You can still post but you’re just gonna have to wait till the start of the next month.”

And so, you can control that budget on a monthly basis the same way that you could control a budget on Facebook ads or any other ads platform. Now, we can’t guarantee that you’re going to spend that full budget because the unpredictable nature of organic social media, but you know that you’re never gonna spend more. So, brands can set like, “Here’s what I’m comfortable spending,” and if you get to the point where they’re like, “Oh, I’m near my budget and I want to keep this going,” they can just increase that budget and it’ll keep going. And so, they have complete control over how much they’re spending.

Kurt Elster: All right, so how does Bounty make money? How do you get paid?

Abe Wolke: Yeah, so we have a subscription fee to use the platform, which is dependent on order volume, just because that’s how… You know, the amount of times that we’re showing the widget and how many people are signing up, and we’re texting, et cetera. And then we have a per-video fee that we charge the brands, which depending on which plan they’re on is gonna vary, and that covers us approving all the videos, and sending all the text messages, and if the video really performs, then we have some upside there. So, we kind of succeed as the brands succeed.

Kurt Elster: There are existing platforms to help to connect brands and creators and influencers. Shopify Collabs and TikTok Creator Marketplace, and there’s another one that starts with a B I can’t think of, so this is different. The fundamental difference is that yours is automated and there’s no gatekeeping. I’m the customer. I just get the offer and it’s up to me to take it or leave it?

Abe Wolke: Yeah. I mean, that’s one of the big differences. I’d say that’s the primary difference and then also we’re not giving people affiliate codes. We’re not saying, “Hey, you have to promote this code and you’re only gonna get paid if someone uses your code.” Because for one, that kind of destroys the authenticity of the content, right? You can’t focus on the story. You’re focusing on the code and click the link in my bio. Two, it’s a very high friction process, so if I’m watching this video and I’ve never heard of the brand before, I’m very likely to click the handle that’s tagged in the caption and visit that brand’s bio or their page and see what they’re all about.

But if I’m not ready to purchase, I’m not very likely to use that code or click your bio, go to your profile and click the link in your bio and go to the website. And so, if I’m not ready to make that purchase right now and you’re trying to push me a code, or make me click the link in bio, you’re just gonna lose me. I’m just gonna scroll to the next video. But it's very low friction to just click that brand’s TikTok handle and go through and visit their page, and now they’ve pixeled me. Now I’m in their funnel.

So, if you look at what was really disrupted by iOS 14.5, these privacy updates that kind of decimated the whole advertising industry for a period of time, although it’s climbing back, is that ability to build that top of funnel and drive that new reach, right? So, how do we reach new audiences? There’s a ton of great retention tools. Brands have that all figured out. Brands spend the majority of their marketing budgets trying to acquire net new customers. And so, trying to break into those new audiences has been very difficult, so our goal is to provide a very low friction way to build that top of funnel even if someone’s not ready to convert today, because alternatively you just lose them.

Kurt Elster: So, what kind of results are you seeing with this? And obviously, you’re gonna tell me everybody who installs this immediately prints $1 billion.

Abe Wolke: How’d you know?

Kurt Elster: That’s just the nature of app demos.

Abe Wolke: No, I will tell you we’ve had videos that have gone viral and gotten millions of views, and the creators have earned thousands of dollars, and we’ve measured 80,000, $100,000 lifts in revenue for brands through post-purchase survey. Those are obviously home runs, right? Those are the amazing case studies, like everybody wants that to happen for their brand. But the other really exciting things we’ve seen is kind of like the story I told you earlier, where creators had earned $12 after they bought the product and then the brand licensed it for another $100, and it performed great as an ad, and now that creator is earning money that they wouldn’t have been able to earn before.

And so, we have a lot more… You know, we have a lot more stories like that and case studies we’re working on. I would say the content from what we’ve heard from brands is that it outperforms their traditional paid UGC creators by multiples just because it’s so much more authentic. So, if you’re talking about a great way to just get real assets that are lower cost and can create better returns as ads, then we’re seeing a ton of success there. Obviously, the home runs here and there with the super viral videos and massive jumps in revenue, and then other than that when you have a lot of organic mentions, and organic social is really popping off for a brand, they’ll see lift in all of their paid media, as well.

So, you’re gonna see a lift in conversions across the board when you’re getting tagged in all this content, so there’s a ton of different benefits to it. You know, the main one would be getting a lot of creative assets and then that occasional virality, but a lot of low cost creative assets that are super, super authentic, that are incredibly easy to repurpose for all your other paid media. So, obviously that’s the-

Kurt Elster: That’s what I’m into here.

Abe Wolke: … bane of organic social media’s existence is like how do you actually attribute the results, right? And we’re working on some really cool tools to do this, such as post-purchase survey integrations where we can say, “Hey, this person is driving views right now, so show their profile picture in the post-purchase survey and when someone says they came from TikTok be like oh great, who sent you?” And so, doing this one-to-one attribution without having-

Kurt Elster: Oh, that’s a cool feature.

Abe Wolke: … to inject codes, without having to do links, so these are things we’re working on, but we don’t have them yet because we’re still also dialing in the core product and trying to onboard a lot more brands.

Kurt Elster: This is a complex thing and you started this roughly a year ago, right?

Abe Wolke: 325 days.

Kurt Elster: Oh, less than a year.

Abe Wolke: Less than a year.

Kurt Elster: It’s quite incredible what you’ve built so quickly.

Abe Wolke: Oh, thank you. Yeah. I mean, so I do have three other co-founders in the company that I want to make sure I give credit to. They came in and we’ve been able to do a lot. Yeah. We raised a first little bit of money in November of last year, started building, basically built it out for four months just the four of us, like the proof of concept, and then we used that to raise our initial pre-seed round, and then we scaled the team from there, so we launched on our first beta brands-

Kurt Elster: You’ve got some big name investors, too, like Sugar Capital is invested in this. They invested in Govalo that Paul and I invested in, as well.

Abe Wolke: Yeah. Sugar Capital is fantastic. I mean, they were on my dream list of investors, and I was like, “Probably we’ll never get them, but hey, we’ll see,” and then someone made an intro and I talked to Brian and the team, and they just got it immediately. And a lot of investors say that they’re independent thinkers but then when you talk to them they’re waiting for all the signal from someone else, so when you talk to someone who really just gets it and makes a decision very quickly and takes the leap, that tells you a lot about the investor, right? They just understand it. And so, I felt that immediately with Sugar Capital. They’ve been great.

We have a ton of other people, obviously, who are fantastic, that have also invested, so we have n13 just led our seed round. We have the founders of Fabletics, and Savage x Fenty and these other companies. Rothy’s. I don’t want to start naming them because I’d leave people out and then I’d feel bad, so I’m gonna stop.

Kurt Elster: You got some heavy hitters here.

Abe Wolke: Yeah. We’ve got some great people involved, so I think it really just speaks to how important this problem is, right? And how much brands are one, looking for new ways to reach audiences, but also how much they want to work with their communities, right? They don’t want to go pay someone who doesn’t care about their product. They would much rather get those resources from their community. And so, ultimately that’s what we’re focused on.

Kurt Elster: I think that the mark of a real, real creator, influencer, is they care about their audience. And the same is true of brands. They care about the customer. They care about their audience. And that empathy, that caring turns into empathy, and that… A, it indicates congratulations, you’re not a sociopath, number one. But it helps you connect with these people in a realistic and believable way because it’s real. It’s like when you’re trying to fake everything that people sniff it out. They know now.

So, all right, one question I had here, I’m sure you have faced some challenges. One challenge, the FTC. The Federal Trade Commission says you gotta hashtag this stuff sponsored content, don’t you? Spon con?

Abe Wolke: It’s true. We require all of the creators to use #Bounty to let people know that it’s Bounty, and then obviously on the website people can see that Bounty is on the website so that it’s like a closed loop and everybody knows what it is to meet those FTC requirements. And then alternatively we have larger brands who are like, “Hey, our legal team requires #whateverpartner,” and so we can support that, as well, so if they have custom hashtags that they need us to use we’ll sub that out. But ultimately every post on Bounty is hashtagged, and the cool part is it's part of our approval process, so our software will automatically check if that hashtag is there and if it’s not, then they can’t withdraw the money. And so, it’s technically not a paid post until it’s FTC compliant.

Kurt Elster: Oh, okay. Interesting. Nice that you handle that. Any other challenges you’ve faced or things that surprised you that you ran into?

Abe Wolke: I mean, for one I’ll say I was surprised kind of how quickly it took off. Don’t worry, there’s real problems that I’ll tell you about too, but we kind of put this out there-

Kurt Elster: I’m surprised by like where I’m supposed to put all this money.

Abe Wolke: I mean, we launched in March. Doe Lashes. Jason Wong, I don’t know if you know him, but he was our first customer, right? So, he was like someone introduced us. I sent him a little Loom video. He’s like, “I’ll do it.” I was like, “That’s it?” He’s like, “Yes. This is sweet. I’ll try it.” So, he was like the first one we launched on. We added five other brands pretty quickly. And from day one when we launched the app it was barely built, we were like, “Who knows if this is even gonna work?” This was back in March of this year. People started signing up.

But the crazy part was other brands started signing up within a day. They saw it on a website, and they go, “I need this.” And they started signing up. So, we immediately had to put up a waitlist because we weren’t ready, like we were running a closed beta with Slack channels to gather feedback from these brands and understand what’s working and what’s not. So, we weren’t ready to scale it, and immediately it just took off. So, we put up a waitlist. I think within two months that waitlist was over 280 brands. Now it’s well over 1,000. And we’ve done zero outbound marketing. We don’t do anything. We’re just focused on building the product.

So, that again really speaks to just how badly people want this product, and we have this kind of nice little viral growth mechanic built in because we’re visible on brands’ websites. And then obviously that was… Really, we built that, that was to get creators, right? We wanted to show it to creators and get them to sign up and that’s worked, as well. We have thousands and thousands of creators who’ve signed up, but it was just really interesting to see how the brands swarmed us.

So, that’s why we went out and raised a seed round so quickly afterwards because we’re like, “We don’t want these people sitting on a waitlist for 12 months. We’ve gotta get them on board, and so we need to scale up the team and increase our velocity.” So, that was the first… I’ve done a lot of things that didn’t work in my past, and so when you have something that’s working I’m like, “I feel like I’m just holding onto the reins,” and it’s like dragging us behind the horse and we’re trying not to lose it, and so that’s been super exciting.

But you know, other real problems we’ve had are for one, creators are gonna try and game the system however they can, right? Paying for engagement, everything they can do to try and get the dollar. Arbitrage, you know? And so, we had to build out fraud detection, and these things are actually surprisingly simple to detect when people do these things. We built all that out and then FTC compliance, tax compliance when people start earning thousands of dollars on your platform. All of a sudden taxes become important, so really just scaling the product so that things don’t break, and I would say the big part is you have to give the creators time because it’s like if you… A lot of eCommerce tools are just numbers and math, right? And you install it on a website and it’s very static.

We have a human on the other end. A human who’s taking an action. They’re posting a video. And so, it’s a very dynamic product and so you have to really give that time to see all the different issues that they’re gonna tease out, right? All the different ways they’re gonna break it, cheat it, game it, and you can’t really rush that process, and then you have to plug every single hole. So, from March to August, that was really our process, was like closed beta, 30 brands, just trying to figure out all the different ways people were gonna use this and make sure that it could scale properly. Support, we’ve got brands doing over $100 million in revenue on the platform. We have brands doing $5 million in revenue on the platform. We obviously had to make sure that it could scale, and it wasn’t gonna break.

And then when people start buying from multiple stores on your platform, make sure you’re not sending them too many text messages. All these different things, but I would say the biggest, hardest part has definitely been on the product side just how dynamic it is when you have a human on the other end, right? So, you’re managing a relationship and you’re trying to do that in an automated fashion and also protect the brands, and also not rip off the creators, you know?

Kurt Elster: It seems low risk. It seems like an easy win. It seems like it solves more so than just I want to make the revenue numbers go up and to the right. It seems like it solves other issues, like you get this content source. You connect with people. There’s a lot that happens here. I’m sold. I’m in. But on the Bounty website there’s a waitlist, so I just have to hurry up and wait if I want to use this thing?

Abe Wolke: Yeah, I mean we’re reaching out to all the brands on the waitlist to schedule demos, learn about where they’re at and how we could help them. We’ve obviously learned about the brands that can be successful on Bounty today, so I will say Bounty in its current state is very much like an amplification platform, so if you’re like, “I need to launch on TikTok, I want Bounty so I can launch on TikTok,” it’s probably not the right time. Because if you don’t have existing traffic from TikTok your users are not TikTok users, and so nobody’s gonna sign up, right? So, we don’t want to onboard brands and make false promises and be like, “Hey, this is like you’re gonna launch this and then your TikTok’s gonna explode.” You have to be making some effort. You have to have some source of traffic from TikTok already, whether that’s organic or paid. It doesn’t matter as long as visitors on your website have TikTok accounts, so that’s one thing.

But we’re reaching out to the brands on our waitlist. We’re scheduling demos. We’re learning about where they’re at. And then for all the people who it makes sense for, we’re starting to onboard them. We obviously have caps right now for how many brands we can support, so right now we’re in the process of adding another 50 brands to the platform, and then obviously we would do more, but Black Friday is coming up so nobody’s gonna be installing new apps in November, but then after the holidays we’ll pick up and we’ll be onboarding a lot more brands.

So, if you’re on the waitlist, I would say most people on the waitlist have probably heard from us at this point, and if you haven’t, you will soon.

Kurt Elster: All right, so in the show notes I’ll link to your site, but it’s just Bounty.co, and then it’s very focused on speaking to creators, and then in the upper right there’s a link for brands, and then that takes you to this waitlist? Yeah, it takes you to the waitlist where you can sign up. And I love the cute little… I love the eight-bit retro graphics. The coolest.

Abe Wolke: Oh, thank you. Yeah. That’s Justin. He’s our head of design and one of the co-founders, and I’ve actually worked with him on three businesses now, so…

Kurt Elster: Well, Abe, if people want to get ahold of you, how can they do that?

Abe Wolke: You know, I wasn’t really Twitter before I started Bounty, but I have found it to be an incredible way to connect with the eCommerce D2C community. I think that’s where we initially connected and so I’m @AbeWolke on Twitter, first name, last name. Other than that, Abe at Bounty.co. Please don’t spam me. And anywhere, basically, just look up Abe Wolke and if I have an account, I’ll show up.

Kurt Elster: This has been phenomenal. I knew I liked the idea but until you hear the pitch you’re never sure quite what you’re gonna think of it, and I’m always skeptical of these things, but having heard it and heard like you’re taking really a thoughtful approach to it as opposed to the 20 years ago, Silicon Valley, just like full steam ahead and see what breaks approach that I’m not the biggest fan of these days. I’m in. I’m sold. I want to use it. It looks so cool. And your approach is honest. You said, “Look, you gotta be on TikTok for this thing to work properly because your audience needs to be there.”

I think the thing I really took away, though, I love the quote content falls on a spectrum of authenticity. I think that’s great. Such a good takeaway. But all right, I gotta go. I gotta go put myself on the waitlist. Thank you so much. Abe Wolke, Bounty. Check it out. Bounty.co.

Abe Wolke: Kurt, thank you so much. Great to meet you.