Take a $100K personal loan to pay creators once early videos return 6x

JosephI love hearing it. I'm I'm biased, but I love consumer. Yeah, that's really cool. People love looking at MRR screenshots, and then their automatic criticism is uh is but but what's the profit? Is it is it profitable? But obviously, it's profitable for you. Do you have to like manage cash flow, or things like that, or do you have like enough margin where you're not like having to reinvest the profits and have kind of like a tight loop?

Dillion VermaYeah, I mean, our main incentive or goal still is to grow at all costs, so we actually reinvest everything into growth. Any sort of marketing expenses to grow and get more out of the app, we're reinvesting into that. So, at the current moment, it's zero. You can say 0% margin, everything's just respent to grow more, and next month it just gets bigger and bigger. That's how we're doing it right now. And interesting story, but in the beginning, we also needed to pay creators and I I didn't have money to do that. Like, we had a bunch of people to pay for making these videos. The way we got by in the beginning was I took out a loan. So, personal loan, I think it was like 100k or so overall, which we used to pay creators in the beginning to boost wrap, and we're scaling at break-even. So, for every dollar put in, we're getting a dollar out of the application at that same time.

JosephIt seems like you had a ton of conviction, you know, with the loan, like you took 100k, and you just like felt that it would work. Like, I'm curious if you learned all of the material and the frameworks of like how to build and grow consumer apps from somewhere, and then just like went in with that conviction?

Dillion Verma… would um ask questions to creators and other program operators, I would learn from like different sources or like just scouting around. There was no centralized source for learning UGC, maybe the podcast with Joseph um and a few other like small- small- small niche circles. And yeah, more specifically about the 100k loan, what I noticed was that insight where if we post a video and it gets a million or so views, the conversion rate was constant.

Dillion VermaAnd I did the math in the very early days, and we saw like um ROAS or or LTV to CAC of like 5-to-1 or 6-to-1 or something. And when I saw that ROAS number, I was like, "Okay, this is enough for me to know that if I just throw a lot of money at this, it'll scale." That one conviction point was just the the return on ad spend for UGC for us.

JosephThat's wild. Six or seven ROAS, you said?