The Story Behind MOJO Marketplace with Brady Nord
WP eCommerce Show

00:00 / 32:48

In today’s podcast, we are taking a look at the unique space that a marketplace fills in the eCommerce world and an example of just what starting up a marketplace involves, both the rewards and the challenges.

To hear the story behind a successful marketplace, we have invited Brady Nord, co-founder of MOJO Marketplace. Brady takes us through his journey and not only shares what it takes to get started, but also how to keep the momentum up and what you need to know about choosing the right products and services to sell.

We chatted about:

  • The decision to start MOJO Marketplace and what drove the founders
  • The challenges that are specifically unique to starting a marketplace
  • What Brady would differently if he had the chance for a do-over
  • The importance of the  service and training aspect in the space of a marketplace
  • The dynamics of selling themes for multiple platforms
  • How Brady makes sure that the vendors who provide 3rd-party services perform to MOJO’s expectations
  • Brady’s final tip on creating an online site as a reseller

Thanks to our Sponsor Bluehost


Bob Dunn: Hey, everyone. Bob Dunn here, known as Bob WP on the web. In today’s show, we are in for a special treat. I know that nothing is more powerful to learn from than the story of someone who has successfully launched an e-commerce site. Learning about the successes as well as the challenges first hand is more valuable than anything you can imagine. Today, I’m excited to bring you the story behind a marketplace. In fact, specifically, MOJO Marketplace. To hear the story, we have invited Brady Nord, co-founder of MOJO Marketplace and currently VP of products at Bluehost. Welcome to the show, Brady.

Brady Nord: Hey, thanks, Bob. Appreciate you having me.

Bob: My pleasure. Before we get into your story, I’m sure we have lots to talk about, can you just tell us a little bit more about what you are currently doing at Bluehost?

Meet Brady Nord, Co-founder of MOJO Marketplace

Brady: Yeah, happy to. As I transitioned out of MOJO, I’m pretty new here at Bluehost. I’ve been a customer long time, but now I’ve been in this role for about six months. I’m focused on rethinking about, how do we change the strategy of hosting? How do we not talk so much about the technology and provide a better platform for people to get online? That’s really the focus that we’re trying to target.

Bob: Cool.

Brady: That goes from our products and services to the platform as a whole. How do we help people succeed online?, not, specifically, how do we provide cPanel or something like that. Really trying to think about the customer component.

Bob: I think that’s true because I’m around these developers all the time. I’m not a developer myself. It may be a little too much outside when talking to clients versus, what this can do for our client. I think those clients, they want to know that it works, one thing. Sometimes that technical stuff it’s like their eyes glaze over and it’s like, “What is this going to do for my business?”

Brady: Yep. That’s 100 percent. 100 percent.

Bob: “What are you talking about, FTP?” Don’t freak me out.”

Brady: Exactly. When you look at the people getting online today, it’s a much more novice user base as a whole than 5, 10 years ago. We have to dumb this down.

What drove you to start MOJO Marketplace?

Bob: Well, let’s start at the beginning. This might also include a little bit of what actually MOJO Marketplace is for those who don’t know. Can you tell us just in a nutshell, what drove you to start MOJO Marketplace?

Brady: Yeah, I was in college and I’m from Salt Lake City, Utah. I want to keep this short, but I was actually graduating in political science and Arabic. I was doing a double major and I just was spending some time in Oman and Jordan working for the Jordanian government. I have no ties to the Middle East, but just decided to learn it, came back, and ran into an old high school friend of mind, J.R., who became co-founder with me. He was doing some client work and I was doing some client work to basically pay the bills. We discovered that we both loved doing client work and leveraging WordPress to do it. Like most people in 2008, 2009 there were big theme shops—you had the WooThemes, you had ThemeForest, there was a handful of them, you know, Studio Press. There was a handful of the older guys doing it well, but the market still was pretty young and I think just being a naïve college guy that just thought, “Why not? If I could learn Arabic, I could learn PHP or something.”

I literally was just that kind of naïve, like, “Why not? I don’t have anything to lose.” I hate saying it, there was no grand master plan. I thought there was an opportunity there, so did J.R. We both felt like, we’re in college, we have very little to lose. Everybody around us was using WordPress to do work on it and why not get on the train and build something with it? I think in hindsight when I look at it, it was the result of doing something every day and it just turned into something. That was really the biggest thing I could think of. Just doing something. We kept working on the site, and added a product every day, tried to get a new affiliate every day, and just eventually, after a couple years, you’re like, “Whoa, we’ve built something here.”

Luckily, we had the freedom of time and could afford to do that. It’s not really some glamorous story of why we started it. The “why” is not so impressive. I’m actually more impressed that we had the discipline and work ethic to just stick with it. A marketplace is a tough business model and I don’t know that I would choose that again. Well, I know I wouldn’t choose that model again in hindsight, but it was good lessons and we made it work.

What are the top challenges for someone starting a marketplace?

Bob: I think that some of the questions I have will be diving into that marketplace part of it because I do find it interesting and I know there’s got to be a ton of challenges. I’m going to start with maybe the top challenges. Marketplace is unique in that you’re a reseller, so it’s different than a typical online retailer. You’re not a store, having inventory, you’re working with all the different resellers. Tell us maybe the top one or two challenges someone should consider when starting a marketplace or thinking about it because, as you said, you’re not sure if you might do it again, it’s worked out great, but there’s obviously some very challenging pieces to it.

Brady: Yeah. I think the biggest thing is that a marketplace is different than a store. A store you can go build your own products and sell them. In theory, marketplace, you have buyer and you have sellers and you’re just the retail location. You have a major chicken before the egg concept that nobody wants to sell with you because nobody buys from you, but nobody’s going to buy from you because there’s no sellers there. Getting just started is a huge. That’s the biggest challenge is convincing somebody to build something or have some sort of merchandise of some sort and sell it with you when don’t have everyone coming to you to buy. You really do have to get creative with convincing them and giving some sort of incentive to start with you.

When we built MOJO, it was the end of February and we’re not like big basketball people by any means, but we were trying to figure out, “What’s a way that we can get some people to sell with us?” We did this contest and you see iPads given away everywhere, but this was right when Steve Jobs announced the iPad. They were about to be released in April to be sold in stores. We did a contest in March and we literally had the doors open for one month and we called in March Padness and gave away three iPads, which they didn’t even sell yet. We were saying, “Once they do come out, we’ll just sell them.” It was really just whoever uploaded the most items onto the marketplace, we sent the top three people iPads. We had to find creative ways like this to incentivize people to upload their work with us.

At that time, you take anybody and everybody. You take whatever inventory you can get. That really is a big challenge, especially when you’re young. Once you have sales, then it becomes a challenge the other way. Once you’ve grown and you’ve become big, then you have problems of trying to keep quality. You start losing people because you have too much inventory. You’re kind of always playing this balancing game between enough inventory and not enough inventory, the buyers and seller stuff. The other point I wanted to call out is what makes a marketplace interesting is you are managing everybody else’s money. I don’t think anybody really thinks about that very much, but in the early days, again, here I am, we’re a few months into this and we’ve got a bank account of a decent amount of money. I think I was 26 at the time or something. I didn’t own any of it. It was all sellers’ money so we had to understand the challenges of, “What do we do with this cash? How are we taxed on it?”

Most businesses, it comes in and it’s your money. You take your margin and the cost of goods is just very different. It’s a different structure. We had to learn how to manage everybody’s money, and how we’d give it to them, and when we’d give it to them, and under what terms. And all that type of stuff. That’s another unique challenge with the marketplace model that I definitely did not anticipate. I think those two pieces are the biggest challenges besides just getting out there and hustling and selling it. That’s probably my biggest feedback on that point.

Bob: Yeah, that’s interesting, that last piece because whether you are starting a business for the first time and you’re thinking, “Oh, I have all this money,” well, most of this money isn’t mine, like you said, that’s certainly different. If you’ve been running a business where the structure was, “Hey, I see my bank account. This is my money. Sure, I have some expenses I pay out,” but then switching out over to a marketplace suddenly you look at it and your bank account may have grown significantly. On the other hand, you realize that, “That’s not my money to spend.”

Brady: Yeah. Another way to think about it was what made it complex, at the end of every month, we had to run the business with an assumption … Let’s say we 1,000 sellers, but we had to run the business with the assumption that, “What if all thousand sellers requested their money tomorrow? How do we afford that?” You’ve also got a sliding scale of commissions. At the time, it was 30 percent non-exclusive, up to 70 percent exclusive. You have to also understand where sellers are within the commission scale. Then, you had you margins on top of that. At the end of the month, let’s say you had $100,000 in the bank, having a clear expectation and understanding of how much of that is yours is not simple for a 26-year-old kid in college that’s still trying to graduate. That was one of the bigger things.

Luckily, we put in safety nets and made sure people had balances above “x” to be able to withdraw. We only gave certain windows of time that people could request their money. Envato and ThemeForest had a similar model at the time, also. We were very much in line with it. Honestly, we appreciate them paving a lot of the way for us in this space. In hindsight, it made things easier. Very few people actually did request their money. We had lots of money to basically fund ourselves from. That was probably the only smart thing we had, is we got to leverage money. We also knew we had to cover our bases if for some crazy reason everybody did come and withdraw their money, that we could cover that. There was a bit of a balancing act and luckily we were naïve enough to make it work. You could get yourself into a lot of trouble if you abused it, for sure.

Is there any one thing you wish you had done differently?

Bob: Oh yeah, for sure. Tailing on that question with the challenges, is there any one thing that you wish you had done differently in the beginning?

Brady: Absolutely. I think the biggest thing that I didn’t understand the power of was recurring products. Recurring products, recurring services, that is single handedly probably the biggest oversight we had. You look at MOJO and you’re looking at typically a $59 theme or service. $59 is kind of that sweet spot.  You’re always chasing that sale. I look back and if we had customers that were still paying recurringly from 2009, it’s a much different business at the point. I understand it’s a harder sell getting up front, but I drive some scalability and if you have any type of exit strategy, obviously that recurring income is massive. Making sure we get recurring products in there from day one is a must. It’s very attractive in all ways.

Then, the other thing is, back to your original point about the technology, I see this in WordPress all the time. People build themes and I’ve been selling themes for eight years or something at this point. Customers come online, they see these fancy demos, and they go buy it and I watch them fail after. They don’t know how to use them. We talk in ways that assume the customer wants to learn how to do these things. We sell products that are really cool to us in the WordPress space and maybe they use custom post types in a really cool way, but the consumer doesn’t really give a crap about it. They don’t even know what we’re talking about.

So many products that we sold in our early days, that were cool to us, I didn’t see them solving very many customer problems. They still needed some sort of help, like a developer friend, or somebody to help get them to where they actually needed to go. I think that was probably one of the biggest mistakes. I think the whole community is starting to evolve to where we realize we have brands like Wix and Squarespace and some of these other builders out there that are coming up that you really don’t need a developer buddy, so to speak, to succeed. I wish we would have found more products in the early days in MOJO that businesses could just buy and it worked for them. I think we were too in love with the idea that we were building and not so much what it gave to the customer. I think that was just a natural trend within the whole ecosystem at the time.

Bob: I agree. Before I focused more on the blog and podcasting, I did  coaching and training for five or six years in the WordPress space. I was one of the few where that’s exactly what I did, especially around themes. I can’t tell you how many time people came to me saying, “I bought this theme. I don’t get it,” or, “Somebody handed it to me. Somebody used this theme. I go in there and it absolutely makes no sense.” They struggled and struggled with it. I spent a lot of time hand holding with people and saying, “This is what it does. This is what it doesn’t do.” I tried to get people prepared to go to buy a theme. They wanted to know, “What can this theme do for me?” People who do this all the time, it comes naturally to us. You really have to have that empathy for those users.

Brady: I think if you go back to it, this is why we needed recurring products. I genuinely feel we’ve got to find a way for themes and plugins to be sold that way so that you know that you’re reliant on that renewal. Right now, it’s really easy to go sell a $59 item. You just make a fancy demo and you don’t have to see that customer, talk to them, earn their trust again. You’ve got your money, and they’ve moved on, and they’ve probably failed on building their site. I truly believe in the recurring model. I’ve learned this big time for being in the hosting space, you’ve got to earn that renewal. When it comes time to hit the bill again, they’re going to quit and you’ve lost that business and that customer. The theme business is the epitome of that, as well as plugins to a point. Plugins do a better job at this, but making sure that you’ve earned that sale is how you keep them coming back. I can’t tell you how many times it was so easy to get a single purchase. That part is actually shockingly easy, but it will never scale.

Do a lot of the developers who come to you work across different platforms?

Bob: I’m going to move to a question that’s a little bit different than a lot of the questions I’ve been asking you. It’s unique to MOJO because of all of the themes you sell. We’ve mentioned WordPress, but you sell themes for Tumblr, Joomla, Magento, PrestaShop, OpenCart, Weebly, Shopify, and Drupal, so you sell a lot of themes. I know from experience, especially on the seller side of things, these are very different communities and they can be possessive of their community. When the developers that you work with come to you, is that really any reflection on, “Wow, you sell all these themes and I want to sell WordPress, but I feel like I’m just going to be a small part of all these other themes.” Do they really care about that? Do a lot of them work across different platforms as well?

Brady: It’s an interesting question. This is a little bit of a blanket statement, but most people that I’ve worked with want to sell what consumers want to buy. It’s not really about the community to them. I think these guys all look at themselves as their own entrepreneurs, they’re building their own business.  Go to MOJO, look at the popular page, or click on a category page. Click on themes and pay attention to how things are sorted. Go to ThemeForest or any marketplace out there and click on a category page, like WordPress themes, and look how things are default sorted. Everything’s default sorted by popular, and it’s popular by sales count, not anything else. I don’t know if it’s sad or not, but people are gravitating towards where people are buying. It’s just the market demand.

Circling back to your question, I’ve seen people enter MOJO selling Joomla themes, for example. They upload one or two and then the next three or four themes are all WordPress. I’ve seen people cross lines quite frequently just because of the demand. We were the first shop to sell Tumblr themes before, I think, Tumblr even had their store years ago. We were one of the first for Weebly. People just ended up moving over to WordPress and I can’t really tell you why. Everybody just seemed very opportunist. As much as someone was making money in Weebly, someone was making a lot more in WordPress. They didn’t take down the Weebly ones, they just kept them up and tried to find what people were buying. I guess that’s my short answer of it. I didn’t see much beyond that. I didn’t see possessiveness. There was a little bit of a time with making the marketplace go full GPL. 

Beyond that, it really wasn’t much. People just wanted to have their items sell. They didn’t really care about the platform. I’m sure if Magento was just rushing it, everybody would build Magento extensions rather than WooCommerce plugins these days. At some point, people are loyal to the platform because they like the cause or something. Ultimately, what I saw in the marketplace environment was it was really just the economics of it. Where were the buyers and what did they want? Even look at the demos in most of the themes and they all start gravitating towards the most popular one. You see trends coming up and down like Avada. I mean, that one on ThemeForest, you had every theme for like six months a year that just copied it, just trying to replicate what they were doing. We saw very similar things like that on MOJO. It wasn’t so much the platform, it was, what trends people do want?

Is it a challenge keeping up with how the vendors are representing MOJO?

Bob: Interesting. Kind of going back to what you sell on MOJO Marketplace, you blend products and services. The services are similar to your marketplace and are offered by providers. Noted that you screen those services and I think you maybe already touched on this because it was getting enough in the beginning, and having too much, and keeping track of everything. Is it a challenge to keep up with how those vendors are representing MOJO? Because the service is being purchased there. Is that something that is an ongoing or challenging piece of the puzzle?

Brady: It’s pretty small, comparatively speaking. I could probably ask the support team more specifically and they would probably have more war stories to share. What normally gets escalated up, I don’t see it as often as you might anticipate. The one thing to keep in mind, the whole service business for us came from the lack of having good products. Not saying that the themes on there were not good.  For example, setting a theme up like a demo service. Themes should just be able to do that out of the gate. Technically, it’s not that hard. They don’t and they require theme sellers to upload their demo data and all this stuff to make it do all that. We said, “We’re tired of consumers not being able to do this. Let’s just give them an option to be able to buy a service and make it do x, y, or z for them.” It was unbelievable the response that we got from our services. It ended up being by far our most profitable component of the business because they just wanted somebody to do it for them.

It goes back to my original point of building products that actually solve the problem. We shouldn’t have to sell these services. Obviously, it’s good for business, but it’s bad for the consumer and it’s not helping us. With all of our service providers, customer satisfaction was always the best because the customer finally had what they wanted. It worked how they were picturing it. There’s still not very many third parties doing services. Most of the services are done in-house, are just done by staff and it’s easy, the ones that we want to keep a tight monitor on. There’s some services that require account-level access that just doesn’t make sense to give to the third parties, for security or whatever reason. We keep those in-house and have a dedicated service team. When the service router needs accessing into the platform, into the host side, they already have access to all those things. All of that makes perfect sense to keep in-house.

We don’t want our buyers having to hand over usernames and passwords to their cPanel account or something to some random person. We’re careful about which services we give to third parties and we screen those third parties closely. I’m not involved in the day to day of MOJO anymore at this point, but I know J.R. Farr, and Tim Robbins, and the guys running MOJO now, we still sit in the same office so it’s not like too much has changed, but they are working on evolving the services business to be much more scalable from third party vendors, to let people build their service-based business on top of MOJO. Stay tuned for that, it should be pretty neat. It actually hasn’t been too much of a problem as far as just getting a rogue service provider. We monitor that pretty close.

Bob: That’s interesting what you said about growing that part of it because when I started exploring WP Live, which is the service you offer on MOJO Marketplace…

Brady: Yep.

Bob: For me, when I stopped doing what I was doing, the coaching and training with people, it was kind of unique because it was very one-on-one. There weren’t a lot of options out there. Now there’s tons of optionsf or  maintaining your site, updating your site, making sure the plugins are good and security’s tight But there weren’t a lot of people who wanted to say to the client, “Okay, I’ll take an hour, sit down with you, and show you how to do this.” It’s not always just going in and doing it for them, but it’s also showing them how to do it if they’re interested in that piece of it. Because that helps them in the long run. When I saw WP Live it’s, “Wow, there’s Bob WP in a pocket.”

That’s my replacement because I did have challenges finding a service out there that would replace what I was doing. People were still coming to me for it and saying, “Will you do this and will you do that?” I didn’t want to deal with the small stuff. I’m going to be interested in seeing how you grow that part because tthat’s what I did for so many years.  Even though we like to say, “The void is being filled,” I think there’s a lot that can still be done. It sounds like you’re heading in that direction, so very cool.

WP Live: a support system for the end user

Brady: It’s funny you mention that. Where WP Live came from is there were a handful of us on the MOJO leadership team just kind of sitting there reviewing support and looking at ZenDesk, trying to understand how we can help people better. It was one of those moments where it’s, like, all of our moms call us when they need help with their website and they’re like, “How do I do this? My e-mail’s not working.” They just think we do all things technology somehow for them. You just kind of inspired me, I want to pull a demographic of the people that buy WP Live, but all of them really are just looking for somebody to talk to to help understand what in the hell is going on. These people are not calling in saying, “Hey, can you write a custom- job script thing for this widget in the top corner of my site?” They’re calling because they’re like, “I don’t know what to do with this. Can you help me understand it?”

I think that’s telling about where WordPress as a customer base is, that we’ve had to build products like this. It was like, “We need to start building a support system that people are willing to pay for and that we can provide.” I didn’t want to say ,”That’s out of our scope.”That’s the last thing you ever want to tell a customer. It’s like, how do we talk to them and help them succeed? This product was really just born out of that and it’s been one of the best products we’ve ever launched.

Bob: Yeah, I think there’s a couple things there. I know that when I worked with people they kept saying, “Sure, I can find a billion people in the world to show me how to do it, but nobody will tell me why I should do this.”

Brady: Yeah, they just want to talk to somebody.

Bob: Then, the other piece is there’s a lot of people that— it’s a gray area and I used to struggle with this a lot in my business— was, what’s the difference between support and what I did, coaching and training? People think, “Okay, Bob. Fix this.” “No, I’m not support. I will talk to you about how you can fix this or we can look at it together. I can show you how.” They would say, “Can you fix it and then tell me how you did it?” No, that’s not exactly what I’m doing here. There was that really that odd gray area between what I did and what people were expecting. A lot of times they were just expecting support.

Brady: Or they got an e-mail and they don’t understand it. They want someone to call, “What does this mean? Do I need to do this? Is this important?” Even elementary basic things. WordPress is still not intuitive in so many ways for customers.

Any other single tip for someone looking to start a marketplace?

Bob: Yeah, I used to get that a lot. Clients would forward me an e-mail, “I just got this e-mail, Bob. What are they talking about here? This is freaking me out.” Okay, so one last question. I know you’ve gone over a lot of stuff here. I just wanted you to be able to add any one other single tip that you might want to share with anybody that’s thinking of creating some kind of a marketplace or an online site as a reseller? Anything that you haven’t talked about yet that you just like leave listeners with?

Brady: You know, I think I would just leave on the note of being very clear who you’re building your products for and making sure it works for them. It’s easy to romanticize how cool your tech is or what you’re building. But ultimately, it’s got to work for your customer. Make sure you’re solving their problem first and foremost and not something you think is cool. I’ve seen that happen all the time with entrepreneurs where they come up with some really cool tech but it’s not real clear what it does for the customer. Keep that in mind that your customer is really what your goal is. If you don’t care about making money and you just want to build something cool, great. If you’re trying to solve a problem, customers will pay you if you do it in a way that helps them. That’s really the biggest thing I could leave you with.

Where can we connect with Brady Nord on the web?

Bob: Excellent. As I said before, the story behind a business is always fascinating. I learned a lot and I hope our listeners learned a lot. For people who want to connect with you on the web, but where are the best places for them to do that?

Brady: I’m on Twitter @bradynord, I’m on LinkedIn, Facebook…I’m probably private on Facebook, I keep that personal. Twitter is probably best @bradynord or LinkedIn you can always connect with me there, or send me an e-mail at bnord@bluehost if you want to talk further about something. Always open to it.

Bob: Cool. Well, Brady, I want to thank Bluehost first for their continued support, of course, and for you taking the time from your busy schedule to join us today.

Brady: No problem. I appreciate it, Bob.

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