Stan's 2023 Shareholder Letter
How we grew 8.1x this year from $1.7M ARR to $14.7M ARR, our key risks, and the multi-billion $ opportunity ahead.
This is the letter I sent to Stan’s investors.
In it, I share how we scaled from $1.7M ARR to $14.7M ARR in the last year, and why I’m so excited for our future as Creators.
I hope it helps you in navigating your own journey as a Creator-Entrepreneur!
It seems like just yesterday I was filming TikToks alone in my dorm room—creating content, building a following, and laughing at how ridiculous I looked on camera.
At the time, I had no idea how to make money as a Creator, but I sure as heck knew that I didn’t want to go back to a corporate job I hated.
So I did what any naïve 25-year-old would do — I “full sent” it.
And I am so glad that I did.
I still remember the feeling of making my first dollar as a Creator.
I had spent months trying to figure out how to build an email list, launch my first digital product, and generate passive income.
And when I finally got my first sale, I realized why people loved “entrepreneurship”.
That first sale gave me hope that, “maybe I could do this” — that maybe I could actually work for myself, making a living creating content about something I was genuinely passionate about.
But what I didn’t realize at the time was that the digital storefront I had built for my own account would one day become Stan.
And that through Stan, I’d get to help all of my Creator friends enjoy that same feeling of making money for themselves.
Looking back 3 years later, I couldn’t be more grateful.
Where Stan is Today
Stan has scaled significantly this year, growing from $1.7 million to $14.7 million in Annual Recurring Revenue.
That’s an 8.1x in just a year. 🤯
We’re also now a team of 20 hyper-talented folks (rather than just me, dancing alone on camera).
But the best part? We now serve over 30,000 Creators—and we help them make millions of dollars per month.
Isn’t that cool? Over thirty thousand people trust us to run their Creator business and look to us to help them convert their followers into customers.
That’s a big responsibility — and we recognize just how much we still need to improve if we’re to make Stan truly worthwhile for our customers.
So in this year’s letter, I’ll look to lay out 3 things for you:
The reason for our success to-date
The key risks we face as a company
And why the Stan opportunity is actually even larger than I first imagined
And I think the best way to do so is by walking you through our year — from our favorite accomplishments we achieved to the biggest challenges we hurdled.
My Favorite Accomplishments this Year
Looking back, it’s wild for me to realize how far we’ve come in just a single year.
Just 12 months ago, Stan was fighting for its life.
The market was collapsing, and we were burning a ton of cash.
And to make matters worse, our growth had flatlined.
So the obvious question to ask is, “how did we turn things around?”
How did we go from almost going under to 10x’ing revenue in just a single year?
The answer is actually really, really simple.
Breaking through Our Growth Plateau
Our greatest insight at Stan is that our customers are our best salespeople.
It’s one thing for us to run paid ads.
It’s another thing entirely when you have thousands of the world’s best marketers organically talking about your product on your behalf.
And so our flywheel has always been super simple:
It’s just to delight our users so that they share our story at scale.
Because it’s our belief that if you do everything you can to help other people and truly see them as a human being, you’ll help yourself tenfold.
And although we were seeing this thesis play out in our numbers in January, it wasn’t at the scale we needed to survive.
And so our pivotal moment in January came from the realization that we weren’t “thinking” about how to build a business properly. Our strategy was right, just not the way we were implementing it.
Specifically, we didn’t understand what it meant to “scale”.
I take most of the blame here — but essentially, early Stan was built off the back of sheer grit and hustle.
That kind of “I need to crank and do everything myself” mentality served us well in our early days, but it severely limited our ability to evolve into an organization that asked questions like, “how do I build a system that makes money for me in my sleep?”.
And so the #1 change that’s driven our growth this year has just been us learning to build “systems”.
Things like:
Implementing an automated sales funnel vs. taking 1-1 sales calls manually
Building self-serve courses customers can consume anytime vs. onboarding every customer manually
Learning how to hire and train amazing people vs. thinking I had to do everything myself
We’re still early in learning how to be systems-level thinkers — but so far, things have worked out okay (though I can already feel our systems breaking again as we hit our next stage of growth!).
Cementing Our Values
This year, it also became hyper clear to me that the #1 reason why we’ve been successful so far is because of our Values.
I realize this likely sounds like a bunch of ‘woo-woo’ baloney, so I’ll try to break this down concretely.
Think about all the brands you respect — Patagonia, Red Bull, or even Chick-fil-A.
They all stand for something.
For us here at Stan, our Values are simple.
We choose to believe in a world where you can both do good and do well.
We believe in the mantra of “give, give give” — that by giving immense Value out to the world, you’ll receive tenfold back.
And if you pair that with data-driven execution — you can build a maelstrom of a company.
A great example of these Values creating meaningfully better business results would be our Support team:
One of the things I’m most proud of is how our Support team shows up for our Creators.
Everyday, we push ourselves on how we can truly delight our Creators.
And what do ya know?
Our customers love it.
The average Stan customer refers an additional 2+ customers during their lifetime — giving a great example of how you can align being human-first with high performing business results.
And so this coming year, we’ll work hard to become one of the most Values-first companies in the world, embedding our Values into our hiring process (scoring candidates on how well they rank on our Values) and our decision-making process (”how truly Creator-first is this decision?”).
Building a World-Class Product
I’m also exceptionally proud of our engineering team here at Stan.
Before Stan, Creators had to spend thousands of dollars and patch together dozens of different subscriptions in order to run their business.
Now with Stan, it costs just $29/month.
In order to save our Creators even more money this year, we shipped:
Email Marketing: No longer do you have to spend thousands of dollars a month on Mailchimp (egregious) — Stan now includes the ability to send unlimited emails to your followers
Stanley: we introduced our own AI assistant, Stanley, who can scrape your content and then immediately help you create your own digital product using your voice, tone, and knowledge!
Community: we just launched the Beta of our Community feature, which allows Creators to host a paid community (chat, audio messages, & calls) to generate recurring subscription income for their business
Paired with the updates we have in store for 2024 (much better customizations / flexible page design, an AI Product Builder, and even a mobile app), I’m confident that by the end of the year, Stan will be the very best product in the market.
Our Key Risks
With all that being said, Stan is still very far from a sure bet.
There’s a ton of stuff that keeps me up at night, but these are my top three: 1) Maintaining our Values at Scale, 2) Executing at Scale, and 3) Churn.
Maintaining Our Values at Scale
I mentioned before that our Values are the core reason why we’ve been successful so far.
My fear is that as we get larger, we’ll lose sight of the one thing that’s driven our success so far — and that’s in caring deeply about our Creators.
I’m worried that as we bring on more stakeholders — employees, investors, customers — the additional layers of bureaucracy will sap away the ‘soul’ of Stan.
My fear is that we’ll stop caring the way that we do for our Creators, or that we’ll forget to spark joy in our day to day amidst the gravity of our business goals.
My hope is that we never become a soulless corporation, one that drags folks off planes or makes you wait 3 hours on a phone tree.
And so this year, I’m setting a goal to learn how we can make Stan one of the most Values-first companies in the world.
My gut says that this starts with being hypervigilant about the quality of the people we bring on, and then investing deeply in their experience.
Executing at Scale
I often joke that your reward in a startup for solving a problem is an even harder problem.
And that couldn’t be more true here at Stan.
Things feel like they’re constantly breaking, and I often worry that I’m out of my depth.
I often ask myself questions like, “am I the right leader for our next stage of growth?”
Or “do I really have what it takes to get s*** done at this level?”
And I think that’s a reality our entire organization must face as we evolve (whether we like it or not) into the next stage.
Both Vitalii and I have never done this before — we’re first-time founders who have no idea how to take a company from $15M ARR to $50M, or to $100M+ for that matter.
We’re kinda just… doing it live.
And so if we’re going to make it this year, we’ll need to get serious about operational rigor, evolve ourselves, and bring in new talent capable of building dependable, world-class processes.
The tension will be in how to balance that with our humanity.
Churn
Churn is our most existential risk here at Stan.
The best way to think about our churn is: how many people are finding true success on Stan?
Because if you’re making money on Stan, you’re likely not going to churn.
The reality of course is that entrepreneurship is a tough business, and so our level of churn is somewhat to be expected in the prosumer / SMB market.
We of course, refuse to take that industry average as a given.
And so I'd like to find a way for us to get Net Revenue Retention above 100%, even if we see Gross Retention in the 50’s.
This means that for the folks truly capable of success, we’re helping them maximize their income to the fullest degree.
Shopify does this by participating in the payments upside of any transactions run on its platform — their payments business now makes up 70%+ of their revenue, riding off the back of brands like Kylie Cosmetics and Allbirds that process a high payments volume.
We'd love to replicate this model here at Stan.
However, to achieve this, we’ll first need to solve a much larger structural issue with Creator Businesses — one that I actually think is the dirtiest secret in the Creator Economy that no one actually talks about…
And that’s that Creator Businesses are fundamentally still pretty bad businesses.
The reason why we have yet to see any Creator Business cross the $BN+ threshold is because to date, the success of a Creator Business has been by definition limited to the output of the Creator themselves.
A single human can only do so much.
And so the very reason for a Creator business’ success in the first place (connection with a single human personality) also becomes its greatest weakness.
A true double-edged sword.
Fortunately — this problem of “figuring out how to scale a Creator business” is actually what gets us most excited here at Stan.
Because imagine if we were able to solve this!!!
How many people could we help pursue their dreams? And how large would the market opportunity be?
The Multi-Billion $ Opportunity Ahead
The Creator Economy is the future of work. Full stop.
It’s the rare job I’ve seen that addresses the entirety of Maslow’s Hierarchy of Needs.
I mean, who wouldn’t want a job that makes a lot of money, connects you to likeminded people, and gives you the fulfillment of having your own thing?
And we might be closer to that utopia than you’d think.
We’re already seeing Creators realize that beyond having a pretty cool job, they also have a significant competitive advantage vs. legacy businesses.
Creators are realizing that they have access to a built-in customer base they can launch new products to, time and time again — that they themselves are the distribution channel.
As an example, in just the last year we’ve seen:
MrBeast scale Feastables, his Hershey’s competitor, into a $100M+ business
Logan Paul and KSI absolutely dominate Gatorade, generating $1bn+ in revenue in 2023 alone
Tezza Barton bootstrap Tezza, her eponymous photo-editing app, to $32M in ARR
The Rise of the Rest
But the thing that gets me most excited is that this success hasn’t been limited to just the MrBeasts of the world.
Here at Stan, we’ve always been intentional about serving the ‘Middle Class Creator’ — not the top 1% of Creators who can afford a staff of 100s — but everyday, hardworking Americans who just want to create financial stability for themselves and their families.
And we’re seeing these Creators succeed in droves.
Take Abigail Peugh for example.
Abigail’s story is incredibly inspiring.
Just a year and a half ago, Abigail’s husband lost his job and ability to work due to a stroke.
With a 2 year-old daughter, and her husband as the sole breadwinner of the family — Abigail knew she was in trouble.
So she did what any hardworking mom does for the family they love — she full sent it.
And just a year and a half later, Abigail has made over $1 million on Stan, and fully retired her husband.
But the joy doesn’t stop there.
My favorite part about running Stan is meeting the ‘long-tail’ of Creators we get to support.
From Creators that bake bread, to Creators who garden, give dating advice, or teach astrology, we’re seeing the reality that you can monetize anything on the internet.
We’re also seeing the entire economy move online and into social — everyday, we have lawyers, accountants, restaurant owners, and even dentists sign up for Stan as they realize social media is the new channel for acquiring customers.
And so when we’re faced with the “success ” problem here at Stan, we get really freaking excited.
Because we ask ourselves the question: “what if we could teach everyone how to replicate the success our top Creators are having?”
“What if we could build a world where anyone, anywhere could make a living doing what they love?”
In an age where so many folks are struggling to pay the bills and we continue to question the establishments around us, I think that’s a future worth building.
We have a daunting task ahead, but this is a mission worth achieving.
Concluding Thoughts
With all that being said, thank you so much for your support.
You’ve believed in us since the very beginning — and we couldn’t be more grateful.
We’ve got a big year ahead of us, fraught with risk and growth, but I know that if we can just stick to our Values of giving, giving, giving, then we’ll be successful long-term.
Thank you for being along for the ride — and I’m wishing you a happy new year,
John (@jayhoovy)
P.S. - We’re Hiring!!!
For anyone interested in building the next great organization — what I hope to be a combination of Patagonia’s values, Goldman/McKinsey’s excellence, and the financial returns of early Google…
Very interesting read! Thank you
Great visibility into your business. Thanks for sharing