In today’s article, we talk to Julia Enthoven, the co-founder and CEO of Kapwing. Kapwing is an online toolbox for short-form video. Currently, Kapwing consists of three main features: a modern meme maker, a trendy sound effects editor, and an online video resizer.
- Monthly Revenue: $9K
- Date Started: October 2017
- Location / Homebase: San Francisco
- Number of Employees: 2 (both founders)
Give us some backstory – a. What inspired your company
My-cofounder, Eric, and I grew up with social media and have always appreciated the power of visual storytelling. I was an early Instagram, Snapchat, and GoPro adopter, but making sophisticated video felt out of reach because I didn’t know how to use iMovie or Adobe Premiere.
Even doing simple tasks – like making a photo slideshow for my grandma’s birthday – could take literally hours to watch a tutorial, update the software, etc. iMovie was slow, hard to use, and froze up my computer.
In 2016, we were both working on Google Image Search and saw both on our own social feeds and in the Search query trends that short-form video became more and more popular. But creators still didn’t have great options to make the short-form content: people had to choose between very sophisticated desktop programs like Adobe Premiere and very casual mobile-only tools like Snap.
We wanted to make a faster, better, more modern tool suite that we could use to make the video we wanted immediately from the browser.
How did you validate the idea?
We put up a landing page to collect email addresses while we built the first version of the product, and the few hundred emails that we got during weeks 1&2 were validating. We built a bare-bones product quickly; it took us about three weeks to launch the web app after writing the first line of code.
After the launch, we reached out to dozens of journalists and bloggers to see if they would write about us, and one did! The usage we saw during the first month was super exciting.
We also started charging for the premium plan almost immediately after launch. It’s validating to see that strangers will pay for your product since you know you’re adding value. And, of course, we interviewed users and potential users along the way to learn more about content marketing, video, and the creative industry.
During the launch phase, did you maintain a full-time job? (or even currently)
No – my co-founder and I worked full-time on Kapwing.
Can you describe your business model and how you feel it works?
Kapwing is free to use, but individual users can subscribe to a premium plan (~$20/month). Right now, we have 550 premium subscribers, mostly from businesses, agencies, and media houses.
The freemium model has been a great way for us to get started. We grow every month and have been able to bootstrap the business. But we know that in order for us to become a much, much bigger business, we need an offering for corporate teams and businesses.
Down the line, we how to launch a more sophisticated video creation platform for content marketing organizations, explore business models for video distribution, and grow a consumer-facing destination.
Did you do any email marketing/outreach?
Yes – we have done email outreach to journalists and bloggers, potential users, possible partners, and community leaders. We also email our current customers and users with product and blog updates, if they have subscribed. I write the emails individually, manually. In the past, we’ve tried programmatic emails (where we get a list of ~100 emails and blast to all of them), but it hasn’t worked as well as tailored emails. Of course, it’s a tradeoff; personal emails take way more time and attention to craft.
How did you acquire customers/subscribers/users?
We have two main channels – Google Search and our video watermark. Eric and I have optimized all of our webpages for Google Search, and we previously worked on the Search engineering teams so we know a lot about SEO. As a result, Kapwing appears at the top of the organic results for high-volume queries like “meme maker” and “trim video” and brings lots of users to the site.
For our free features, the output videos have a “kapwing.com” watermark embedded into the corner. When Kapwing users share the videos on Facebook and Reddit, their friends and fans see the watermark and look up Kapwing. The product has built-in virality in that way: every free user is also an advocate for the brand.
Once you developed a user base, how have you maintained it?
We try to deliver a ‘Wow’ user experience so that users remember us and come back to Kapwing down the road. Our features are faster and simpler continued launching new features. Since we’ve focused on SEO, we have a steady stream of users looking for video editing tools online, and those that make videos regularly come back because of the quality of the experience.
We also work hard to have a transparent, authentic brand that reflects who we are: young, scrappy individuals trying to build a creative business. Kapwing’s users – mostly content creators, artists, entrepreneurs – relate to our story.
What software / platforms / tools have you utilized since launch? Which have worked / not worked?
We love Stripe, both for payments and for Stripe Atlas. We’re loyal members of the IndieHacker, Product Hunt, and HackerNews community
- ProfitWell is an amazing analytics dashboard that integrates with Stripe data.
- Hunter.io has helped us get email addresses for outreach to bloggers and journalists
- We’ve played around with MixMax and SendGrid to automate email processes, but they’re too expensive for us. Still looking for the right solution.
- We started on AWS but moved to Google Cloud because it’s cheaper for us (they have great discounts for startups)
- Lastly, we use Kapwing all the time, of course, to make and edit video for social media
How did you fund your startup and how does it make money?
So far, Kapwing has been bootstrapped – Eric and I are building the product ourselves and have spent almost $0 on marketing, operating expenses, or design. We live on our savings and revenue, and we have been totally focused on developing the product and growing the business.
Luckily, our startup is the kind of business that makes money from the start and has low capital requirements. Kapwing’s revenue comes from a premium subscription that some users pay for. Right now, we make ~$9000/month right now and growing ~30% every month.
After many debates and discussions, we recently decided to raise venture capital money to fuel Kapwing’s growth. We are just closing our seed round now and will use the money to accelerate product development and experiment with marketing. With a bit of money in the bank, we will be able to pay ourselves a salary for the first time since leaving Google.
What were your KPIs when you started, have they changed?
The most important KPI for us is how many videos have been created every day. We started, of course, at 0 and have grow steadily MOM to an average of 3900 videos/day.
Now that we have some funding, we don’t need to be so concerned with revenue growth. We’ll be focusing more on retention – how can we make the product better and stickier for existing users?
To date, what have been your biggest challenges as a company? What have you done to overcome them?
Self-doubt is a huge barrier. If we become too sceptical of our own strategy, we are distracted by debating each other and analyzing instead of making progress. When you found a company, you need to have the confidence and will to stubbornly persist, because even the wrong decision is better than no decision at all. Eric and I have a strong relationship as co-founders and lift each other up out of self-doubt trench, and we have a deliberate tendency towards action.
What are your plans for growth?
We plan to continue building out a modern video creation platform for casual creators! The product will include both powerful, beginner-friendly editing tools and a platform for video inspiration. We’ll make it simple to remix viral memes and video formats and create beautiful, hilarious, and informative content for social media. Down the road, the platform will help teams/businesses scale video production. And much more! Short-form video is a mega-trend, and we want Kapwing to be the modern home for creators and a destination for consumers.
If you had to do it all over again, would you? What would you do differently?
I would have spent less time analyzing and more time doing. Launching features and experimenting is the best way to learn.
Do you have any advice to give?
My advice to founders is to think about distribution and monetization from the start. Getting people to use and pay money for your product is just as important as building it.
Lastly, if anyone reading this wants to know more about your company… where do we send them
To the Kapwing blog! We write a lot about the journey of growing an internet company in Silicon Valley. You can also reach out to me over email or Twitter. For anyone who creates video or social media content as part of their job, I would love to hear your feedback about our product or find a way to work together.