#66. SelfMade provides Instagram-in-a-box for entrepreneurs, giving small businesses the tools and services they need to succeed on social media as conducting business online moves from websites to Instagram accounts. We talk with co-founder Brian Schechter about the company, where social media is headed, and what it’s like building on a closed and constantly evolving platform. The Loose Threads Podcast features in-depth discussions with leaders across the rapidly changing consumer economy.

Check out the full transcript below.

Richie: [00:00:07] Welcome to the 66th episode of the Loose Threads Podcast, a show about the rapidly changing consumer economy. This episode is brought to you by Loose Threads Membership, which gives you actionable analysis, insights and events that drive growth, and Loose Threads Espresso, your energizing and high-pressure filter for consumer news—in context. We also have a newsletter that features the latest open letters to CEOs, podcasts with industry leaders and news from Loose Threads. Check it all out at LooseThreads.com.

Richie: [00:00:35] Joining me today is Brian Schechter, a co-founder of SelfMade, a company providing Instagram-in-a-box for small businesses. As conducting business on the Internet has shifted from having a website to having an Instagram, new infrastructure needs to exist for businesses to thrive. SelfMade fills this void, giving entrepreneurs the tools and service they need to succeed on the platform today.

Brian: [00:00:55] The playing field is wide open for us to build Instagram-in-a-box for these small businesses that can’t afford to do it fully on their own and don’t have the expertise to do it fully on their own.

Richie: [00:01:05] Brian and I had a wide-ranging talk about the company, where social media is headed and what it’s like building on a closed and constantly evolving platform. Here’s my talk with Brian Schechter.

Richie: [00:01:18] Why don’t we start. Just talk a bit about your background and then we can work our way up to SelfMade existing and its evolution into where it is today.

Brian: [00:01:24] My first business was a dating app called How About We, which launched in New York in 2010, and, prior to that, I was a high school teacher who then joined the Barack Obama 2008 political campaign as a field organizer in Missouri and, while having that experience, I just fell in love with leading adults. As a high school teacher, I actually loved working with teenagers, but realized a whole other thing was possible for me as a leader in the context of working on the campaign. Decided, from there, to start a business with my best friend from childhood and, together, we created How About We, which was a dating app that allowed people to post date ideas that they wanted to go on, like “How about we go get drinks at this rooftop bar?” And we spent four or five years building How about We and then sold to IAC in 2014. I went to IAC to run the business there.

Richie: [00:02:20] Nice.

Brian: [00:02:20] And then, while there, I had the idea for SelfMade. The spark of the idea was watching my fiancée edit images before sharing them onto social media. When I was watching her engage in the activity of editing her photos, it struck me as extremely creative. It wowed me in terms of how much time and effort it took and the end results, I knew, [were] extremely valuable. And I started thinking, how could you provide that same end result for people without having to put in any work? So I had this idea of, essentially, a network of pro-quality photo editors who would be supported with computer vision technology and image processing to be able to move really quickly to get to a pro-quality image to share on social, which more and more people were wanting to share, at a really affordable price. That was the initial idea and it’s very different from what we’re doing today.

Brian: [00:03:13] Today, what we’re doing is, essentially, Instagram-in-a-box for small businesses. What we’ve learned over the past, now two years, of building SelfMade is that Instagram has become so important for businesses that they have to have a presence there, in order to stay relevant, in order to maintain the credibility that they want to have with their customers or potential customers. But, for many people, they just don’t have time to do that. They don’t have the know-how or they don’t have the time. So the same insight there that got SelfMade going… But, now, it’s really about, how do you build a business in today’s world where your website is no longer the place where people are going to find you, and assess whether or not they want to become your customer, compared to Instagram? And so we’re building out an experience for our customers where we, essentially, deliver one high quality post a day for them. We do the caption writing, the hashtags, the time of day, the editing, creating a cohesive grid for them. We’re layering on Stories right now. We’re starting to introduce ad-buying into the experience. Essentially, all the things that someone needs to be able to do to get the most out of Instagram. If you’re a small business and don’t have the time to do it yourself, we’re building out a solution for people.

Richie: [00:04:24] So you had this insight. You saw your wife editing these photos. When was this, year-wise, and where would you say social media and the personal brand was, at that time?

Brian: [00:04:32] Yeah. We got fortunate on that front, in that this was the summer of 2015. And so, when I first started sharing the idea with people, people were saying, “What are you talking about? Everything is now Snapchat and video.”

Richie: [00:04:44] And what did video mean? YouTube or…?

Brian: [00:04:46] It was right at the moment when Snapchat and Lenses were happening.

Richie: [00:04:50] Okay.

Brian: [00:04:50] So video meant messaging short video footage that’s gone through a series of post-production steps.

Richie: [00:04:59] Right. Which was mostly Snapchat.

Brian: [00:05:00] Which was mostly Snapchat. And Snapchat had been rising for 18 months or 24 months. My position, then, was that our digital culture is just a reflection of human culture and what happens online is just a manifestation of human psychology and we desire, both the ability to express ourselves in an aspirational way and the ability to express ourselves in a fleeting, casual, gritty way, and different people and different cultures, at different moments of time, veer one way or the other. But, the truth is, we really require both in order to share ourselves fully. The aspirational form of self-expression takes time, takes support and we rely on experts. We go to beauticians or we go to stylists or we think about, “Who is the designer that really resonates with me when I figure out what kind of clothes I want to put on?” And we were over-indexing on the authentic, especially from the perception of what mattered for people, and not giving enough credence to the importance of really crafting and curating what you want to express.

Brian: [00:06:08] And so we bet hard on that with SelfMade and I think that, over the past now two-and-a-half years, I feel more conviction that that balance is needed. And what’s also happened is that Instagram has found a way to incorporate both into the platform with Stories.

Richie: [00:06:22] Right. Because, at that time, you could kind of dichotomize Snapchat as the ephemeral, grittiness, as you said, and Instagram as this perfectly polished [thing].

Brian: [00:06:31] Yeah. Snapchat was born as a rejection of the permanence and of the sense of inauthenticity of an over-doctored life, which makes sense and was needed and I think Instagram is learning how to just really balance those two components of identity.

Richie: [00:06:47] 2015, you’re sharing this idea around. What are the early incarnations of it?

Brian: [00:06:52] It was fun. It was messaging people on Instagram saying, “I’m working on a business idea where I would get a professional to work on any image you would like to share before you share it and you can tell us what you want done. Do you want to try?” People would say, “Sure.” I would say, “Give me your number. I’ll text you and then you can start sending me pictures.” And then I built a small network of photo editors who would work with me for relatively low amounts of money to work with their images. And, immediately, it was apparent that there was a big question of, how do you actually capture someone’s brand? Because people are very precious about their image. And so, [I] began learning quickly that you need to create a workflow, essentially, of trial and error, taking risks, and that, when you get it right, people just go gaga. It’s exciting when, all of a sudden, you present to someone an image where they say, “That’s me. And I feel great about it and I want to share it in a way that puts a pep in my step.” And so we started seeing that happening over text. At that time, “we” was “me,” yeah. I just loved it. I loved trying to figure out how to do that.

Richie: [00:08:04] And, just to clarify, the clients, so to speak, were taking the photos themselves. This was purely post-production, at the time.

Brian: [00:08:09] Totally. And the clients were college students, high-school students and people who were just out of college. And that was the original idea of whom we would build SelfMade for.

Richie: [00:08:22] Did they have followings or were they nascent?

Brian: [00:08:24] Totally nascent. When I would explain the idea to VCs, everyone would go to followers and influencers and models and celebrities, which is relevant. But I was really interested in just the everyday use case of the same person who’s thinking about what kind of makeup to buy, what their friends are wearing. They’re also thinking, heavily, about how people will be responding to what they put out onto Instagram. So much so that they’re watching how people respond, they’re deleting images if they don’t get a good response, they’re going through five or six different photo editing apps to get to the image they want to share. And that use case or that pain point was the one that I was more focused on than a professional.

Richie: [00:09:05] Right.

Brian: [00:09:06] Once we got going and raised money and I’d spent more and more time in the Instagram ecosystem, I started to realize that the influencers and the micro-influencers—influencers are the people who are being paid for the media they put out onto social and a micro-influencer is someone whose career is really where it is, in their given field, because of the brand they’ve been able to develop there. So, think of the SoulCycle instructor with 10,000 followers whose seats are always filled at every class. They’re getting inbound interest from brands all the time to be able to share their products. They’re being asked to stay at certain hotels. They’re influencers but it’s not their career.

Richie: [00:09:48] Right.

Brian: [00:09:48] So that’s my definition of those two, just to make it clear. So, started spending time with them and realized they had the same needs, which was, “I don’t want to spend time editing my images, figuring out how arrange them, figuring out when to post or which hashtags to use.” And so, we began building the version one of SelfMade as a subscription product for anyone who was taking their brand seriously on social.

Richie: [00:10:09] And where was the price on that?

Brian: [00:10:10] That was $50, $100 or $150 a month.

Richie: [00:10:14] Okay.

Brian: [00:10:14] That was like V1 of SelfMade. From the very beginning, after we raised our seed round, we knew that we wanted to go after people with commercial intent, who would be ready to make a real investment, with the ideas that we would then go downstream toward the college student who just wants to spend $1 to $2 an image and is not ready to make an investment of, say, like a monthly subscription fee of $50 a month.

Richie: [00:10:35] So what was the response from the micro-influencers or those that had kind of commercial needs?

Brian: [00:10:41] The response was, “I want this.” And it was relatively easy to get people to become customers and very hard to service them.

Richie: [00:10:53] And what did the service mean?

Brian: [00:10:54] It was, basically, nailing their image in a timeframe that they liked, a seamless enough experience. For those customers that are [paying] $50—for them, that was a big investment.

Richie: [00:11:07] Right. Because they’re used to not paying for anything.

Brian: [00:11:08] And they’re not used to spending on marketing themselves.

Richie: [00:11:12] They’re like, “I’m the channel. What do you mean? You pay me not—”

Brian: [00:11:15] Yeah. So it was a hard customer to satisfy. That led us to move toward, what I was describing a moment ago, around Instagram-in-a-box for small businesses. I just began realizing that the paradigm was shifting so fast for businesses, where their website was becoming less and less the central place for where they would be found and related to online, and that those people actually have marketing budgets. And we decided, “We’re going to go after the people with marketing budgets right now.” The thing we’re trying to build, overall, is really about helping brands, broadly speaking, to do the thing they need to do online so they can pursue their goals and not spend all of their time trying to brand themselves.

Richie: [00:11:56] It’s interesting that it sounds like you found it harder to, in a timely manner, embody the person but found it easier to embody the brand or to do something to their liking? Do you have any sense, like—is that just people are more complex than companies? How did that kind of play out?

Brian: [00:12:11] They have to do it, whereas the brand builders we were going after could do it on their own. They have a marketing budget and they need to figure out, “where am I going to deploy it,” “what makes the most sense for me,” and “I don’t have a good way to invest in Instagram right now” versus our original customers [for whom] it was much more of a choice. But it’s still a challenge for us and we’re still really working on crafting what’s a workflow that—

Richie: [00:12:35] Or like a onboarding process.

Brian: [00:12:38] It’s an onboarding process. When someone becomes a customer at SelfMade now, they take a survey—we build for them—essentially, a brand strategy. We have an onboarding call with a content strategist, an image specialist and a brand manager who are working on ensuring that we have the right visual aesthetic, the right voice, the right understanding of their audience, that manifests, essentially, as a content calendar of “here’s what this is going to look like but let’s get some feedback.” And then, once we get approval on that, we begin sending, essentially, these content calendars through the consumer side app, where they can then comment and approve or give additional comments about relevant things for the image and then we do the posting for them.

Richie: [00:13:21] Right. And so it shifted from purely a post-production activity to an entire end-to-end.

Brian: [00:13:27] That’s right. Once we went to people who were the businesses and started figuring out their needs, it was much more, “I need someone to do this for me.”

Richie: [00:13:34] Right, “just do it.”

Brian: [00:13:35] Not just do the photo-editing part for me.

Richie: [00:13:38] Talk through some examples of what are use cases or some of those customers or best practices, in the sense of, are they using it purely as a marketing activity? Do they use it purely for sales? As, basically, we’ve gone from desktop to mobile and now to Instagram and other kind of—

Brian: [00:13:54] Open web to closed.

Richie: [00:13:57] Right.

Brian: [00:13:57] It really is. It’s the Facebook ecosystem.

Richie: [00:13:59] Right.

Brian: [00:13:59] You’re brand identity, it’s Instagram and your Facebook page, for a lot of our customers, is quite relevant as well.

Richie: [00:14:06] So talk through some examples of customers.

Brian: [00:14:08] Let’s say I run a salon and I want to have our clients and our potential clients to be able to see the type of work that we do. It’s got to be active. Like, if you go to our Instagram or if you can’t find our Instagram and you’re thinking about switching or your friend goes there and you don’t see anything, that’s now table stakes to see some presence. And so it’s posting everyday for them. And we’re layering on Stories now.

Richie: [00:14:34] Instagram Stories.

Brian: [00:14:34] Instagram Stories, yes. The comments—custom hashtags that are totally specific to their brand and helping them to feel confident enough to say, “I’m going to create a hashtag that’s going to be just for my salon and I’m going to be using it every single post and my customers are going to start using it when they come in and when they share their content.” So there’s that business all the way to “I run an Etsy shop.”

Richie: [00:14:57] So that one’s a discovery.

Brian: [00:14:59] It’s discovery, it’s credibility, and then it’s foot traffic. At the end of the day, every business is interested in transactions.

Richie: [00:15:07] Right.

Brian: [00:15:07] We have, actually, we’ve started to realize there is this demand among people who provide insurance. Individual and boutique insurance providers all over the country are recognizing they too need to be on Instagram. And they’re not at all the kinds of people who have been on Instagram—at all. So a lot of people are coming to it now saying, “Oh, I have to be here now.”

Richie: [00:15:29] I feel like the salons, the tattoo parlors are the obvious ones but I wouldn’t be a surprised if car dealers come to you and these very, interestingly, offline businesses that need to now use digital something to generate their energy.

Brian: [00:15:42] A way to think about is, if you needed a web site ten years ago, and then you started saying, “Oh is it Wix? Is it Squarespace? Who’s going to solve this problem for me in as small amount of money, with the least amount of time for me so that I can focus on my actual business?”

Richie: [00:15:58] But, maybe the difference is, [the platform]. That wasn’t actually the work getting done and that would normally have been a $50,000 [expense, working with an agency].

Brian: [00:16:07] That’s right. The big difference with social is that you need a steady stream of visually consistent, on-brand, pro-quality content. And so, what we’re building at SelfMade, sort of at an abstract level, is an image-processing pipeline that’s able to create content in [accordance] with our customers’ brand identities. It’s an outsourced, social media manager with branding capabilities.

Richie: [00:16:33] So what does that content creation process look like? If I’m a customer, do I send you all the photos? How does it the workflow actually happen and work?

Brian: [00:16:41] It’s a combination of photos that you send to us through the app. We find good accounts that you should be reposting that are about building your network. So, if I’m the salon, I’m going to repost from my customers. I’m going to repost from my different stylists. I may have a few designers that I really love and I’ll repost their content. And then, in some instances, it’s source content which is what businesses, from a Casper to a Nike, do with their Instagram accounts. It’s not all photoshoots that they’ve done themselves. We’re, actually, now piloting a photoshoot process as well. So, anyway, we get the initial content. Then we have a team in Jakarta that does the post-production work, that really assembles a cohesive, on-brand grid that can get quite stylized. You know when you see someone’s Instagram and you’re like, “Wow, this is a piece of art.” Not only are individual images stunning, the relationship between them is really crafted. So you’re seeing—

Richie: [00:17:41] The three-by grids.

Richie: [00:17:42] Three-by grids, you’re seeing continuity in terms of shades, you’re seeing an evolution of shades.

Richie: [00:17:47] Borders, framing.

Brian: [00:17:48] The whole thing. We’re your Instagram solution. So the team in Jakarta does the assembling post-production and then we send it back to our customers and they can then approve or do feedback and we will do rounds with them.

Richie: [00:18:01] Okay. So we talked about the salon—that is, the credibility, the discovery, the foot traffic. And then, it sounds like there are also the more transactional customers.

Brian: [00:18:09] Yeah. And, whether it’s ecommerce or brick-and-mortar stores selling products where you want to be able to be showcasing your products on social. Those are some of our emerging customers right now as well.

Richie: [00:18:20] So the business model is still some sort of subscription, retention, something?

Brian: [00:18:24] Yeah. It’s $750 a month. We’re experimenting with some of the six-month packages. Some of it’s, if you do six months, it’s $500 a month, but it’s still subscription.

Richie: [00:18:33] One of the interesting things about Instagram is [its] commerce capabilities. To call them nascent is probably polite, in terms of they have their little buy buttons, but they really have invested very little, seemingly, in that. How does that affect what you do and then how does that also affect the business model that most of the transactions—actually, all of the transactions—happen off the platform?

Brian: [00:18:53] We’re not contemplating taking a cut of transactions. At least, certainly, not yet. For instance, right now, we’re doing an initiative around ad buying to help with driving actual conversions for our customers and, there, it’s purely pass through. It’s more around helping them to get the most out of the platform. The shop capabilities on Instagram are getting more and more robust. Our focus is more around how will we help you to ensure, one, that you have the content that can drive clicks into the shop experience and then how can we help you to optimize that experience. But, today, it’s one post a day, Stories and now we’re layering on photoshoots and ad buying, with [the sense that] there’s going to be an ongoing expansion of the features set that you would want to provide for a small business that’s trying to get the most out of social today.

Richie: [00:19:45] What was your first thought when Stories launched, both as a user and for the business?

Brian: [00:19:51] This is really smart. I didn’t know just how much they would be able to stop Snapchat in their tracks. It was unbelievable and part of it was, I think, it’s just so easy to say, “Well, I’ve been doing this on Snapchat but I have no idea who’s watching. It’s not really a big audience. It’s another place to be doing this.” And all a sudden, you do the same thing on Instagram and everyone’s engaging with it.

Richie: [00:20:21] One of the most fascinating things for me was the underlying difference in the social graph.

Brian: [00:20:25] Yes.

Richie: [00:20:25] In discoverability and you can take almost, effectively, the same tool but if you put it on a different graph, with different set—it massively changes the whole dynamic.

Brian: [00:20:33] Correct. The value is in the network.

Richie: [00:20:35] Right.

Brian: [00:20:36] And then you have to be able to iterate on the features set that’s of the moment. And then, clearly, figuring out video, people have been wanting to do for a long time because it’s a more engaging format. In dating, people are always trying to figure out how do you create video profiles and video messaging. And one of the things, I think, that people in the dating industry understand is, well, when you layer on video, the fullness of people comes out, including warts and all, and that [it’s] harder to get people out onto a date if they’re doing video. It’s almost too much information.

Richie: [00:21:08] But then, on the brand side, it’s the opposite?

Brian: [00:21:10] I think, in terms of what’s captivating and what drives engagements, on a social platform, it’s highly desirable. In a dating site, which is a very particular kind of interaction, it’s total strangers where you’re trying to figure out, “[Who] do I want to go meet?”

Richie: [00:21:23] Right.

Brian: [00:21:24] It’s harder. I think video, on the brand side, is also just as imperative now. It’s also just how people are spending their time on Instagram. If you just opened up the app, it’s literally the top thing. It’s all the Stories. You start scrolling through the feed. Here’s how you get to more Stories. And that’s what people are doing.

Richie: [00:21:40] So, now when you’re talking with customers or building out this pipeline, how do you go—story versus post? What is that calculus?

Brian: [00:21:47] We’re working on cracking the code for Stories right now. What’s the workflow that we need to create with our customers to develop high quality, on-brand Stories that will engage their audience? It’s a different question than building out a feed plan.

Richie: [00:22:01] And what are the calculations, within that dichotomy?

Brian: [00:22:04] We’ve got to do it because it’s where the engagement will happen. It’s where someone’s going to stay relevant and stay top of mind to someone’s followers. And it feels also like that, too, has become table stakes for your Instagram presence. The way we think about is, “What are all the different types of formats? How can we bucket our customers into what types of formats with different buckets want? And then how do we get the content from them, both the visual content, but then also with Stories?”—oftentimes it’s a story. You have to figure out, well, what do you really want to be saying? And we’re still working on that.

Richie: [00:22:38] Every time I look at them, it seems like so much work. I don’t know. Sephora will do like a 20-slide story.

Brian: [00:22:45] Yes.

Richie: [00:22:45] It feels like that takes so much time.

Brian: [00:22:47] This is what I’m trying to figure out right now too.

Richie: [00:22:49] How to not make it take so much time?

Brian: [00:22:51] The way that we think about it is more [of] how to break it down into specific steps so that we can then build technology to manage the workflow of all those steps. Because, if you can do that, you can make it so that the cost of it is not bad. The more granular each step becomes to ensure high quality output, the more technology we can layer into the experience, whether it’s workflow technology or automation technology.

Richie: [00:23:17] As I think about it, what makes it challenging is, if all you had to do was put images in, you could cue those somewhat easily, but because of the dynamic elements, whether it’s the tagging or the—that seems to me [that] it takes—

Brian: [00:23:30] We’re betting hard on the view that Instagram is going to create more and more support tools for businesses to extract value from the ecosystem.

Richie: [00:23:40] I guess that was the Facebook playbook and so—

Brian: [00:23:42] The writing is on the wall. Moving to an algorithmic feed is the key first step because then you can prioritize posts, including paid posts or ads. Instagram just rolled out the ability for partners with API access to be able to schedule posts. It’s just a matter of time before there are tools to support social media managers to be able to interact with customers because the expectation that you’re going to be able to log in and be texting with all of your customers, which is the only way to do it right now, just doesn’t make sense. And Instagram realizes the huge value that brands now see on the platform and they’re going to build for that.

Richie: [00:24:26] Right. Which also was something that was less evident on Snapchat.

Brian: [00:24:30] Totally. I think that Snapchat—just to be clear, I don’t count Snapchat out at all.

Richie: [00:24:35] Right.

Brian: [00:24:35] I try to interact enough with people who are still in their teens and Snapchat is still super relevant for them. And I do think Snapchat, it does have a history of doing really bold innovations and there’s a lot of value in the attention that is specific to Snapchat. But we’ll see.

Richie: [00:24:55] Right. But [it] also probably raises questions. [Is] that as much as an advertising market versus people who are older and have discretionary income?

Brian: [00:25:03] Snapchat has a big challenge in that it needs to keep innovating right now to keep the users that they currently have, expand and build ad products on top of that. The one thing Instagram had the real good fortune of having was that it was allowed to grow and grow and grow, in the context of being part of Facebook.

Richie: [00:25:20] Right.

Brian: [00:25:20] Its ability to grow and figure itself out and take on this foundational role in our digital culture. [It] didn’t have to monetize in any real way to justify itself, compared to what you would expect from any other platform. So it’s really unique in that sense and I think part of the reason why it’s been able to establish itself the way it has is the freedom that it had to hold off on monetization for so long.

Richie: [00:25:44] It seems the paradox is that it was so successful because of that, that it got to this point but, now that it’s at this point, it has to abandon that to actually go to the next level.

Brian: [00:25:54] I think so yeah. It’s so valuable right now, what Instagram has created, which you can see in terms of the number of people who are viewing it as relevant to their business, whether it’s an individual or a business. It’s so much a platform where people discover what they want to purchase, discover the experiences that they want to have, the lifestyle they want to lead. That’s where people go to right now on the Internet to figure out, like, “Who am I identifying with and what are my aspirations?” And that’s just an inherently extremely valuable thing for advertisers.

Richie: [00:26:28] Right.

Brian: [00:26:29] Which connects the whole influencer phenomenon.

Richie: [00:26:31] Yeah, let’s talk about that.

Brian: [00:26:33] I mean it’s interesting in that there are just so many people who would like to be able to, basically, be a celebrity who’s able to make a living by being a celebrity. I think that the reality is that the market has a big mismatch—the number of people who can command big brand dollars is actually very small. And, even the number of people who can commit a meaningful amount of money, enough to get by [on], is relatively small just because there’s so much competition. And the number of people who have, even 100,000 legit followers—if you have 100,000 legit followers because you do something that those people are really interested in, you can make a living doing that. If you’re really good at it. The truth is that so many of the people who have 100,000 followers are just not legit. They bought them and those followers are not real and they don’t provide any actual value to brands and I think people—there was just an article in The New York Times—

Richie: [00:27:30] Right, a big one, yeah.

Brian: [00:27:31] Brands [that] are looking to partner with influencers to promote their products are completely awake to the fact that they need to be savvy on the platform. And so, when you really look at high-quality followings, there’s either too many for someone to be able to actually say, “These are my rates.” And for brand to say, “Why? I’ll just go to somebody else who’s got an analogous following, an analogous style, also works with the same audience that I’m trying to reach and do the same thing and they’re going to do it for free, as long as I give them some products.”

Richie: [00:28:04] Right. Is that driving prices down?

Brian: [00:28:06] Yes. The savvier […] brands are getting and the easier it is to access the influencers, the less viable the influencer path is. And so it’s not something that I would advise to anybody. There are some people who are really good at it and those people can make a great living. They can build—there are a lot of people, when you dig underneath the Kardashian realm, who are building real businesses and building out their own lines of, you know, a lip balm or a makeup or a food delivery service. It’s just hard as hell and it’s not as easy as it looks. And, most of the time, when you actually hear what those people are actually saying, they say, “This is a lot of work.”

Richie: [00:28:48] So, two-part question then. What do you think is the staying power of all of this, in terms of is there longevity or are these flashes in the pan, and so forth? And then, two, how does a diversification into these influencers creating their own businesses—is that foreshadowing almost the analogy to the NBA player who has 12 good years and then he’s like, “I need to get my talent and money elsewhere”? The longevity question, I think, is just so interesting here.

Brian: [00:29:15] Yeah, I think it’s really interesting. You can, certainly, extrapolate, from where we are, a world where individuals build their own brands, they build their own distribution channels. You can now—through Shopify and a host of other businesses—that have made it so easy, if you have an audience and if you have a product vision, to produce, sell, market a product with very, very little infrastructure. It’s kind of similar to—I remember when the Web 2.0 was happening, and everyone and was talking about how cheap it’s become to start a company because you no longer have server costs and you no longer have to pay for all these lawyers because everything has been streamlined and people just get how to do it. And there is something very similar happening, I think, in ecommerce for sure. I don’t know how far that will go.

Richie: [00:30:07] Right. Barrier to entry has dropped to zero. Barrier to success is much higher now.

Brian: [00:30:12] Absolutely. What that also translates into is that the competition is, actually, even more fierce.

Richie: [00:30:16] Right.

Brian: [00:30:16] Because anybody can do it. That means everybody is trying.

Richie: [00:30:21] Right.

Brian: [00:30:21] And so it’s hard but it’s exciting too. It feels like it’s empowering and there’s a meritocracy to that. But I think we’re a long way off from that actually happening. And, by long, I mean three to five years. I think that where we are right now is more [where] big brands [are] learning how to extract the value from the closed system that we’re now in.

Richie: [00:30:42] Back to the influencer engagement thing—we’ve been studying a lot of live video stuff in the last two weeks. And one of the things that—and you see this, not even just in the video, but also just purely in post—is you can have a million followers and the ratios are 1%, 2%, 3%. What does that mean, generally? What does it tell you about the size of followings versus—

Brian: [00:31:03] So the basic arc is that the more followers that you have, the lower your engagement percentage should be. If you have 1% on a million, you’re doing pretty fantastic. That’s a lot of people just engaged with that one piece of content. It matters a ton. There’s a lot of fake engagement also on Instagram too, in terms of if you go through and just look at what people are saying and then do some additional—

Richie: [00:31:28] I report stuff as spam all the [time]—it’s so annoying.

Brian: [00:31:30] Yeah, it’s unbelievable. So I do think that Instagram has a big issue. I think that that actually, in terms of another theme that Facebook is going to need to really deal with, is around credibility with advertisers who are super skeptical of the platform in terms of the legitimacy of impressions. I think that’s actually an existential threat for Facebook right now, whether it’s government regulations or the advertising industry saying, “We’re going to keep on pushing and trying to find alternatives where we have more clarity about who’s actually seeing this.”

Richie: [00:32:06] What’s on your wish list as a consumer for the next Stories? Where do they go from here?

Brian: [00:32:12] I think that the thing that Instagram has just done with following tags, you would like to be able to have something analogous to that with stories. Everybody wants content that’s actually catered for them, that is beneficial for them, that really gives them the thing that they want. There was a fascinating article in The New York Times this weekend about the way in which YouTube has been prioritizing extreme content.

Richie: [00:32:40] Yeah.

Brian: [00:32:40] It’s radicalizing people.

Richie: [00:32:42] But, more than that, from my understanding, the thesis was, it is the largest radicalization mechanism in the world.

Brian: [00:32:47] Yeah. You watch a video clip of Bernie Sanders and then what you get recommended to you is a video clip of a conspiracy theory that 9/11 didn’t happen.

Richie: [00:32:56] Right.

Brian: [00:32:56] You watch a clip of Trump at a rally and then what you get recommended to you is—

Richie: [00:33:00] Infowars.

Brian: [00:33:01] Yeah it’s unbelievable. And so the thing that I would really want is the ability to be consuming stories and be able to say, “Give me more of this.” And that requires some type of recommendation that Instagram is providing or that Facebook is providing with its livestream, where I’m actually getting to content that I want to consume, not that sort of attempting to sedate me into a fascination with content that’s not even good for me.

Richie: [00:33:32] So the kind of undercurrent of all these things we’re talking about is [that] you are working in a closed ecosystem. You do not control the platform. How do you think [in] both the short- and long-term about that platform risk of—we know what happened to the Farmvilles and the Zyngas and that has been written, specifically on Facebook, many times before. So how does that go through your mind and what are steps you take to mitigate that?

Brian: [00:33:53] The thing that we want to be really good at is guiding a brand through a process that establishes, for the brand, what their presence should be like online in a way that is highly scalable, in a way that is conducive to automation and is flexible enough to be able to move from platform to platform. That feels like it’s not going anywhere and that core competency is one that I think is free of platform risk. But I don’t spend much time thinking about, “When is the Instagram game going to be up?” because it’s now, for the past two and a half years […] really being a close observer of this—it just feels like it’s just getting more and more entrenched in our culture. And then it feels like, in general, the Internet is getting more and more entrenched in our culture and less and less fluid. The staying power feels more powerful than it did two years ago. That said, everything always changes and there will come a day when a new platform emerges and a new entity emerges that starts to capture mindshare in a really powerful way. NBC, ABC, CBS are still around and they’re 70-plus-years-old. So it’s unclear how long we’re in an Instagram-centric world.

Richie: [00:35:13] Why not do this or spend the time on Tumblr or Pinterest? And how did Instagram get to the point where it is among them?

Brian: [00:35:19] I haven’t heard our customers mention Tumblr ever. Pinterest, some care about. Pinterest still has mindshare for some of our customers and, for right now, it’s totally about focus. I would love to be able to be ensuring that the content that we’re helping our customers to create ends up on every platform where their customers may be. But, in terms of what they care about, it’s Instagram. It just rules the day for them. But it would be better if it was, for us, if we were saying, “And we’re going to help you here and we’re going to help you here and we’re going to help you here.” But, for the foreseeable future, we’ll be just investing in making that work for them on Instagram.

Richie: [00:35:58] Are there lessons, though, from the stall out of Tumblr and/or Pinterest that Instagram should learn from for continued success?

Brian: [00:36:06] I think that Facebook has the DNA, more so than any company, to understand how [to] maintain attention. And what they’ve done with Instagram over the past two and a half years is just unbelievable on this front. From internationalization—[which] is a big part of it—to copying Snapchat—[which] is, I think, the other big part of it. And then just high-velocity iteration on realizing that they’re in, to some extent, a feature war with Snapchat around what […] the Stories experience like, what are the lenses, what is the media that you are able to inject into the experience. They’re having that battle atop such a stronger network.

Richie: [00:36:44] It raises questions about how much the feature set matters over time, if it is truly a commodity and they’re on just a better network.

Brian: [00:36:51] I think it matters in that you have to stay relevant. But it matters less and it’s easier to spot. Like, oh, this is what everyone’s doing now. This is what you do.

Richie: [00:37:00] It’s a means to the end now. It’s not the end.

Brian: [00:37:02] Exactly. “The networks” is an interesting analog in that it’s like, you have a nightly news show, you have a daytime talk show, you have a soap opera.

Richie: [00:37:09] Right. Anyone can do any of those.

Brian: [00:37:10] Yeah, you just learn the format and it becomes more about media creation tools that you’re churning out, similar to a production company, more so than true innovation, where if you get the right feature you’re going to all of a sudden be the next winner.

Richie: [00:37:26] But it also seems that, if you look at the stalling out or the failure of the Tumblr or the Pinterest, the dichotomy between consumer attention and business attention can work so perfectly if it is there, but also if it isn’t. Like Tumblr never had a business model.

Brian: [00:37:42] Right.

Richie: [00:37:43] And there are still plenty of people that use Tumblr for inspiration or whatever it is, but that balance seems so delicate. And it’s interesting that Instagram was able to kind of punt it for a long time.

Brian: [00:37:52] That, I think, is this thing that’s really fascinating about their story—[the] Facebook acquisition just extended its runway, indefinitely, and allowed [it] to really find itself, years after it was already a huge thing. But the thing that it’s become is now way more powerful than I think that they could have even imagined.

Richie: [00:38:14] Yeah. Do you think it will surpass Facebook proper?

Brian: [00:38:16] I think that, in the U.S., Instagram is more valuable than Facebook.

Richie: [00:38:21] Today?

Brian: [00:38:21] Today.

Richie: [00:38:22] Yeah?

Brian: [00:38:22] There are a lot of people who just, it’s like, “Why go there?” It’s still a utility, in that it’s the central place for the social graph for me.

Richie: [00:38:30] If Facebook’s a utility, what is Instagram then, in that analogy?

Brian: [00:38:34] It’s entertainment. It’s a media company. I mean, Facebook is that too. The thing about Facebook, that it has so down, is incredible targeting capabilities. And there still is intense usage but the usage on Instagram and just what it’s like when you look at someone who’s checking Instagram—it’s like they’re going into their own world where it’s not like they’re seeing what their friends are saying, they’re seeing what people are buying and they’re seeing what kind of lifestyle they should be leading and it’s alluring and that is so valuable. Instagram is a place where you go to see what you want to become and Facebook is a place where you sort of like go and see like—

Richie: [00:39:16] What everyone has become.

Brian: [00:39:19] Yeah and it’s like, well, that’s not nearly as enticing.

Richie: [00:39:23] The dynamics are so interesting, especially because they’re owned by the same company. And they have, increasingly, the same underlying fundamentals but have such distinct identities as well.

Brian: [00:39:30] Which is pretty awesome. And I think, to some of the things I think that you’re thinking about a lot around commerce and around building a brand—I mean, I’m sure you’ve heard this. I don’t know who said this first but the idea of brands on Instagram [trying] to act like people and people try to act like brands. That reality is so important for any company trying to figure out their social strategy, in relationship to Instagram, for growth purposes.

Richie: [00:39:59] What’s been the cheapest and most expensive lesson building SelfMade?

Brian: [00:40:03] The most expensive lesson for us was realizing that what our customers cared about, more than the edits we were delivering to them, was the level of service we were providing and the full scope of brand support we were providing for Instagram. That took us about six months to learn and, if we had learned it in one, we would have saved a bunch of money.

Brian: [00:40:29] And the cheapest lesson, I would say, for any entrepreneurs, and this is my second time doing this and I’m two years and change in, and I feel like I am just, finally, starting to learn just how valuable it is to be in constant communication with your customers. It costs no money and your ability to think clearly about what matters and what doesn’t and what you really need to be going after and what they care about—it just changes so radically. Everyone gives lip service to that. But I know very few founders who actually spend two to four hours a week talking with their customers about their experience and what they’re looking for and what they are enjoying and what they’re not enjoying. I feel like I’ve finally ingrained that lesson and it’s accelerating our growth and our innovation and it’s cost no money.

Richie: [00:41:17] So my last question is two part. One, what type of company do you consider SelfMade? Is it media? Is it tech? Is it some amalgamation of those? And then, two, what’s on the horizon and where are you hoping this goes in the coming years?

Brian: [00:41:30] So SelfMade is a technology company, first and foremost, but we’re solving a problem that requires humans. We use humans to deliver the thing that we need to deliver today, but we see technology as the way in which we are going to win. My co-founder was the lead engineer on Google Sheets and then ran all of Google Docs in New York and is a phenomenal technical leader. We are of like mind in terms of pragmatically addressing the question of how are we going to deliver what our customers need now. But we know that technology is the answer to this problem which is, how can everyone extract maximum value from social to accomplish their business goals? And that’s a technology challenge. It’s also workflow challenge and it’s an operations challenge. But, the core of the business is using technology to solve those problems.

Brian: [00:42:17] And then, in terms of where we’re going, I think that we’re not even in inning one yet of when Instagram is going to say, “Okay brands, here’s how you can get the most out of this platform from an advertising standpoint, from getting increased impressions for your organic content, from the ability to connect with influencers.” And so the playing field is wide open for us to build Instagram in a box for these small businesses that can’t afford to do it fully on their own and don’t have the expertise to do it fully on their own.

Richie: [00:42:48] Do you feel like you’re waiting for them to move or is it that there’s enough to do in the meantime as they continue to do that?

Brian: [00:42:55] Enough to do in the meantime. Again, at the core of our challenge is figuring out how to work with the brand to mirror for them, “This is what you look like on social, right?” And for them to say, “Yes, that’s it.” And then for us to cheaply support them to be able to produce that content. That’s a big challenge that we’re getting better at every single week. And then, as we layer on more features like ad-buying, that’s already fully set up for us to be able to plug into the API and start delivering value there. Scheduled posts is another example. I actually would like them to go quite slowly, to be honest.

Richie: [00:43:33] Interesting.

Brian: [00:43:33] Because there are a lot of players in the space that are already fully established, who built social media marketing solutions years ago for Twitter and Facebook pages—[…] the faster Instagram grows, the easier it’s going to be for them to just swoop in and layer on additional features.

Richie: [00:43:47] Right. But I guess what seems interesting is, because you have that service element, if you can acquire and retain those customers for a longer period of time, they don’t need Buffer instead of you. They want you.

Brian: [00:43:57] Yeah. The thing that’s unique about social compared to the web is, with the web, you put up your website and you’re done, and on social, you need a steady stream of content. And that’s, traditionally, very expensive. So that’s why we’re building this image processing pipeline that can cheaply deliver high-quality, on brand content that is, today, not accessible.

Richie: [00:44:21] Awesome. Thanks for talking.

Brian: [00:44:30] Yeah.

Richie: [00:44:30] Thanks for listening to the Loose Threads Podcast. You can read the full transcript of the podcast and join the newsletter at LooseThreads.com. Feel free to also leave a review on iTunes. We always appreciate it. Thanks to George Drake Jr. for editing this episode. We have a great roster of upcoming guests including Sarah Nakintu of Kintu, Fran Dunaway of TomboyX and Rachel Blumenthal of Rockets of Awesome. Thanks for listening and talk to you soon.