📶 How we're thinking about 2024

Say “hey” 👋 | Apply to community 👥 | Upgrade 📶 | Archive 📰 | Become an affiliate 💸 | Sponsor 📣

Good morning 👋

A lot of thought goes into goal setting. More emphasis should go into implementation.

Before the end of 2023, we shared a little about our goals for 2024 (linked here in case you missed it).

Building the audience, multiplying income, and growing equity are the three pillars of our business in 2024.

Here is the detailed view of how we are thinking about hitting those goals before the end of the year.

If you have any thoughts or feedback, we’d love to hear it.

TL;DR:

• 👥 Audience

• 💲 Income

• 📶 Equity

AUDIENCE

We think creating a business without an engaged audience in 2024 is playing life on hard mode.

So we’re investing every additional dollar back into growing our audience this year.

When we talk about audience, we are talking about an owned audience of email subscribers (compared to a rented audience of followers).

Here’s everything we are currently doing to earn new email subscribers:

• Twitter ads: Our Twitter account is currently suspended (no idea why), so this project is on pause for now. Before we got canceled, we were offering lead magnets to narrow lookalike audiences (think people following other finance / meme accounts). New subscribers from Twitter ads had an even better engagement rate than our existing reader base (a good sign for any subs coming through paid channels), and we think all newsletters should be advertising on Twitter (here’s a list of creatives for inspiration). If any of you have Twitter contacts, plz intro us so we can get back to it.

• Facebook / Instagram ads: I was reluctant to run FB ads forever. “Who still uses Facebook?” The answer: the world. Their ads platform is a lot more complex than Twitter, and your targeting can be niche. We’ve spent ~$1,000 so far to win ~300 new subscribers. These subscribers aren’t quite as engaged as the Twitter followers, but the engagement rate is within 5-10% of our benchmarks. Our goal now is to reduce the payback period for these subs so we can pour more money into these ads. Boosts has made this possible, and our revenue per new subscriber is $2.16 through boosts alone. That means that as long as we can get our acquisition costs below $2.16, we’re essentially growing for free.

• beehiiv boosts: This has driven thousands of new subscribers for us over the past six months, and it’s our most effective marketing channel right now. These subs come from other newsletters, and beehiiv ensures that you are only charged when an engaged subscriber signs up for your newsletter (you’re not charged for a low-quality sub who doesn’t open your emails). Cannot recommend beehiiv enough if you’re thinking about starting a newsletter.

• beehiiv referral program: We’ve revamped this over the past month, and we’re now giving away more of our best stuff to those that refer friends, family, and co-workers over to this newsletter. More info on that can be found at the bottom of this email.

• Free lead magnets: If I’m putting myself in the shoes of somebody finding us for the first time, what would warrant enough value to exchange an email to get it? That’s the question we’ve been asking ourselves when designing this page. We’ll keep adding to this list, but if there’s anything you want to see, let us know.

• Blog popups on the website: Everybody hates pop-ups, but we’ve learned people don’t mind as long as you can entertain them. So that’s what we’re testing. Now whenever a new subscriber scrolls halfway on our website, we share a pop-up to redirect them to our best piece of content. Once they’re here, we then tease the idea of receiving that type of content in their inbox every week (in a non-sales-y way).

• Subscribe embeds on each page of the blog: Every page on our blog has an email capture embed, and we pair that with a free digital download section. Nearly half of our email subscribers coming from our website are coming via one of these subscribe forms.

• Monitoring Reddit: This is a WIP, but Reddit is a goldmine for intent data within niche audiences. The problem is that Reddit is a rabbit hole, and I’m incapable of logging on without spending at least an hour bouncing around different forums. So instead of doing this ourselves, we’re teaching EAs to monitor a handful of subreddits and plug our info with links to our website. We’ve also started testing Reddit ads to drive new newsletter subscribers, and those campaigns currently have an effective CPM of $1.21 (wayyy lower than what you get for the same reach on FB or Twitter).

Here are other things we are considering:

• Giveaways: We like the idea of giving things to our most loyal fans. We tested out a free hoodie giveaway to our top newsletter subscribers in October, and we plan to test more giveaways like this that are attached to some sort of referral goal.

• Memes-as-a-service: Memes move markets, and we want to invest more into this. We’ve seen accounts like Liquidity, Overheard on Wall Street, and Praying for Exits parlay attention towards larger business goals. If you’re already making memes (and want to get paid for your work), send us a few samples.

• Guest posts: We have now run two guest posts, and we’re planning to share a third soon. We love this model (stolen from @BowtiedBull) where you build up an audience so that you can help lesser-known audience members tell their stories to the broader group. We’ve already done this with a few readers (linked here and here), and we have a few more queued up. If you have a presence online and have already written about something that you think would resonate with the readers of this newsletter, let us know.

INCOME

We think income should be a byproduct of quality audience growth + quality segmentation of your audience based on their needs + clear offers that solve for those specific problems.

We have a handful of offers, but these are the core offers of our business:

Community membership

• ICP: This type of product isn’t needed by everybody in our audience. It’s perfect for junior VCs (analysts, associates, and principals) looking to give themselves an edge in career progression. It’s not as useful to partners and GPs who already have the knowledge, a network, and deal flow they can trust.

• What we’re testing to grow: This newsletter and LinkedIn drive the highest-quality traffic to our private community, and we’re doubling down on both of those. In the newsletter, you might have started to notice ads at the bottom of previous editions that tease what community members receive. These have worked relatively well so far. We have also started to use PhantomBuster to automate connection requests to our ICP through LinkedIn.

Recruiting-as-a-service

• ICP: Most funds overestimate the quality of talent they can attract and retain. The ICP for the recruiting service is the person at a fund that is currently hiring or plans to hire in the next 6-12 months. We have found this is usually the partner, GP, or head of platform / operations.

• What we’re testing to grow: We’ve cleaned up our segmentation process both for the community (asking where applicants need help) and in our newsletter subscriber survey (asking for more information about pain points in current role). On top of that, we are starting to use unused ad slots in the newsletter to promote owned products and services like this one.

Analyst-as-a-service

• ICP: Every fund is looking for more output, but not every fund has the AUM to warrant another FTE. This offer is for any partner or GP that needs to outsource some of their work (writing memos, creating market maps, cleaning up fundraising decks) to a part-time analyst. We have found that this ICP is usually investing out of a fund I - III.

• What we’re testing to grow: This is our newest service, so we are testing a lot of things to grow. We’re making the assumption that email and LinkedIn will be our highest-quality channels again, so we’re working through systems to nail and scale that outreach.

Sponsorships

• ICP: Companies looking for efficient growth channels. If you want to test different offers with engaged audiences, we think newsletters are your best bet. The alternative is to crack the code on platform advertising and let me tell you from experience, good luck with that. If you have a relevant offer and want high-quality visibility, let us know.

• What we’re testing to grow: We’ve started linking our sponsorship page at the top and bottom of each email, and right now we’re averaging ~120 unique visitors to that page / week. A 1% conversion means we only book up 1/3 of our ad inventory (newsletters go out Tuesday, Thursday, and Sunday), so we are thinking through how to grow top line number of unique visitors.

Courses

• ICP: Our Community Builder Playbook is for anybody who is looking to create a moat for their business by creating an engaged community. The Ultimate VC Resource Library is for anybody looking to get up-to-speed and learn more about venture; this could be a student, a founder, or somebody looking to make a career switch and start venture investing. We realize only a select few people are willing to buy courses, so we try to not aggressively promote these, and we’d rather give most of the info away for free.

• What we’re testing to grow: People like promotions and discounts, so we’ve been offering discounts to anybody that takes the time to read this newsletter (resource library linked here + CBP linked here). Gumroad also has an upsell feature, so we’ve unbundled a lot of the resource library, made those bits free, and upsell the paid version. This has worked wonders.

EQUITY

There are two ways to improve the equity value of Confluence:

1. Grow the revenue base by growing the offers discussed in the previous section

2. Grow the equity value of companies we invest in through our syndicate

We think #1 takes care of itself if we do what we say we’re going to do in the section above.

#2 is a little bit trickier.

For those of you who haven’t managed a syndicate, let me be the first to tell you, it’s a brutal game.

You have to:

1. Attract enough LPs (with enough liquidity to fill rounds) to back you

2. Build a standalone brand as an investor that can attract and win over elite founders

3. Convince those founders to give you an allocation (even though you don’t have the money yet)

4. Go and convince enough LPs in step #1 to match the allocation amount you quoted to the founder in step #3

Difficult to say; difficult to do.

We think the best way to convince anybody to lend you their money is to show what you’re going to do before you make any ask. That’s why we’ve started doing writeups on some of the most interesting companies that come into our funnel (check them all out here).

We have a ton of other companies queued up to share - shoot us a note if you want to trade notes on any of them.

Here’s our syndicate link if you’re accredited and want to invest in any of our future deals.

REFER
Earn free stuff 🎁

You can get free gifts by telling your friends and family to sign up 👇

You currently have 0 referrals, only 1 away from receiving 77 Tools That Make Up the VC Tech Stack .

Copy & paste this link: https://confluencevcweekly.beehiiv.com/subscribe?ref=PLACEHOLDER

Thanks for reading this far and giving us a little bit of your attention this week.

Feel free to unsubscribe whenever this stops becoming valuable to you.

- Clay