Rob Walling

And that is the basis for today's episode. Before I dive into that, tickets for MicroConf New Orleans. And of course, I will be there in New Orleans. And if you want to get together with about 250 speakers, of your favorite bootstrapped founder friends, head to microconf.com slash US. The tickets right now are the least expensive they will ever be.

And they will go up in price, I don't know, in a few weeks or a month or whatever. In addition, we are going to sell out. We sold out our Europe event. I believe we sold out Atlanta last April. So if you want to get a ticket, there is no reason to wait. microconf.com slash US. Let's dive in to platform risk. So I'm going to start with these three factors that contribute or define platform risk.

And they will go up in price, I don't know, in a few weeks or a month or whatever. In addition, we are going to sell out. We sold out our Europe event. I believe we sold out Atlanta last April. So if you want to get a ticket, there is no reason to wait. microconf.com slash US. Let's dive in to platform risk. So I'm going to start with these three factors that contribute or define platform risk.

And each of these you might think of on a scale, you know, whether it's one to 10 or one to 100. there can be a small amount of risk for a specific factor or a large amount. So the first one I think of is a replacement.

And each of these you might think of on a scale, you know, whether it's one to 10 or one to 100. there can be a small amount of risk for a specific factor or a large amount. So the first one I think of is a replacement.

So if you are on a platform, whether that is using SendGrid to send email, whether it is hosting on AWS, whether you built a no-code app in Airtable or Bubble, whether you are a Heroku app or Shopify app, is a replacement available for this platform? And how hard is it to switch? And is the pricing approximately the same? So there are more questions than that, but those are kind of the high level.

So if you are on a platform, whether that is using SendGrid to send email, whether it is hosting on AWS, whether you built a no-code app in Airtable or Bubble, whether you are a Heroku app or Shopify app, is a replacement available for this platform? And how hard is it to switch? And is the pricing approximately the same? So there are more questions than that, but those are kind of the high level.

So it's replacement. So we might think of, well, what is an easy replacement where it's available, it's not that hard to switch, and it's a commodity, so the pricing is the same? Well, that is something like, I would say, SendGrid, Postmark, Mandrel, Mailgun. The switching cost is real. It is a thing. But it's connecting to a new API. And it depends on how deeply you're integrated, obviously.

So it's replacement. So we might think of, well, what is an easy replacement where it's available, it's not that hard to switch, and it's a commodity, so the pricing is the same? Well, that is something like, I would say, SendGrid, Postmark, Mandrel, Mailgun. The switching cost is real. It is a thing. But it's connecting to a new API. And it depends on how deeply you're integrated, obviously.

But that switching cost is not catastrophic. And pricing in that space of sending email or even SMS, you know, I think of Twilio and, you know, the kajillion SMS APIs out there. There are a lot of replacements available. So that's going to be a much easier spot. But what if you are built on Shopify's API and you are in the Shopify app store? Is a replacement available?

But that switching cost is not catastrophic. And pricing in that space of sending email or even SMS, you know, I think of Twilio and, you know, the kajillion SMS APIs out there. There are a lot of replacements available. So that's going to be a much easier spot. But what if you are built on Shopify's API and you are in the Shopify app store? Is a replacement available?

How hard is it to switch and is it priced the same? Well, the pricing doesn't necessarily make sense in that context, but is a replacement available? How hard is it to switch? It's kind of like, no, there really isn't a replacement. And switching is basically impossible, right?

How hard is it to switch and is it priced the same? Well, the pricing doesn't necessarily make sense in that context, but is a replacement available? How hard is it to switch? It's kind of like, no, there really isn't a replacement. And switching is basically impossible, right?

Because if you were just a Shopify app and you're like, well, they kicked me out of the app store or they took my API access away. It's like, well, we can go build a BigCommerce, a Magento, a WooCommerce version, right? But it's not the same. It's not a replacement. And that's not really switching costs. That's just building, spinning up a whole new product, right?

Because if you were just a Shopify app and you're like, well, they kicked me out of the app store or they took my API access away. It's like, well, we can go build a BigCommerce, a Magento, a WooCommerce version, right? But it's not the same. It's not a replacement. And that's not really switching costs. That's just building, spinning up a whole new product, right?

So the hard to switch is just astronomical. So when we think about replacement from one to 10 or one to 100, that takes you from easy to hard, at least in my mind. So the first factor was replacement. Second one is customer concentration. And The question here is, are the majority of your customers on this platform?

So the hard to switch is just astronomical. So when we think about replacement from one to 10 or one to 100, that takes you from easy to hard, at least in my mind. So the first factor was replacement. Second one is customer concentration. And The question here is, are the majority of your customers on this platform?

Meaning that if you were kicked out or the API access were shut off or somehow the platform suddenly said, you know, you're on Twitter's API and they say, we need you to pay us $12,000 a month now to maintain it, are 80%, 90%, even 70, 60% of your customers on this platform in a way that essentially will decimate a huge amount of your revenue?

Meaning that if you were kicked out or the API access were shut off or somehow the platform suddenly said, you know, you're on Twitter's API and they say, we need you to pay us $12,000 a month now to maintain it, are 80%, 90%, even 70, 60% of your customers on this platform in a way that essentially will decimate a huge amount of your revenue?

Now, what's interesting is this is separate from the third factor, which is I'm saying lead flow or customer flow. That's on an ongoing basis receiving new customers, say, from an app store listing or a marketplace listing. And that's different. It's related, but it's different than customer concentration. Because in theory, I could go build a Twitter client.