Slack Limits Community Growth
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Sam Parr and Shaan Puri discuss their experiences and insights about paid communities, particularly focusing on Soul Savvy, a sneakerhead community. They emphasize the limitations and potential of such business models.
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Paid Communities Business Model:
- Can grow quickly with an existing audience
- Requires minimal initial capital
- Can be profitable with lean team structure
- Fun to run if aligned with personal interests
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Key Challenges:
- High churn rate is a significant concern
- Shaan's community experienced 7% monthly churn
- With growth, net churn was around 1%
- Scaling limitations
- Communities become less valuable as they grow
- Value diminishes when too many people have access to same information
- High churn rate is a significant concern
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Platform Considerations:
- Slack is considered a poor choice for building paid communities
- Doesn't scale well
- Limited functionality for community management
- Slack is considered a poor choice for building paid communities
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Revenue Potential:
- Soul Savvy example:
- 5,000 members at $33/month
- $160,000 monthly recurring revenue
- However, venture scale potential is questionable
- Hard to justify $2M funding
- Difficult path to becoming $200M+ company
- Soul Savvy example:
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Better suited as lifestyle business:
- Great for passionate individuals in specific niches
- Works well for dedicated community leaders
- May not be ideal for venture capital investment
Sam Parr
Host of MFM and fitness influencer
Sam Parr is a serial entrepreneur and business media pioneer.
In 2016, he founded The Hustle, a business news media company that started in his kitchen with just $12 and grew to eight figures in revenue.
Sam led the charge in making newsletters popular when few believed in their potential.
After four successful years, he sold The Hustle to HubSpot, a publicly traded company. Now operating as HubSpot Media, The Hustle reaches 3 million readers daily, employs a team of nearly 100, and has been the launchpad for dozens of its staff to found their own media companies and newsletters.
Sam remains the host of the popular business podcast, My First Million, and continues to start and sell companies. He also co-founded Hampton, a highly vetted community for entrepreneurs, founders, and CEOs, and teaches people to write better through his platform, Copy That.