How Noah Kagan built his first business for $50 and got first 200 clients…

How Noah Kagan Turned a Simple Idea Into 200 Paying Customers and Laid the Foundation for AppSumo

Every entrepreneur has faced the fear of failure after investing time, money, and resources into an idea. Noah Kagan’s first foray into entrepreneurship in 2010 could have easily ended the same way—except for one pivotal difference: a friend challenged him to validate his hypothesis first.

This approach became the cornerstone of his success with AppSumo, which now boasts nearly a million subscribers on its email list and has become a powerhouse in the tech deal space.

Here’s the step-by-step story of how Noah got his first 200 paying customers without a website, starting capital, or even a product:


1. Spotting the Opportunity

Noah, an avid Reddit user, noticed the popularity of the Imgur app and its premium version, Imgur Pro.

  • He realized that many Reddit users might value the additional features of Imgur Pro but would be more likely to purchase if it were offered at a discounted rate.
  • The idea: Use a discounted Imgur Pro account as his product offering to Reddit users.

2. Partnering With Imgur

Noah reached out to the founder of Imgur via email with a straightforward pitch:

  • He asked if they would be willing to offer a promotional deal at a steep discount.
  • After initial hesitation, the Imgur founder agreed with a simple, “SURE!”
    With the product secured, Noah had something to sell—but no website or customer base to sell to.

3. Tapping Into Reddit’s Community

To reach his target audience, Noah took creative and resourceful steps:

  1. Cold Outreach to a Reddit Founder:
    • Noah emailed one of Reddit’s founders and invited him to breakfast.
    • During the meeting, he pitched his idea and built rapport.
  2. Securing Free Ad Space:
    • Recognizing the value of the deal for Reddit users, Noah requested free ad space on the platform to promote the Imgur Pro discount.
    • The Reddit founder agreed, seeing it as mutually beneficial for the Reddit community.

4. Setting Up the Backend

Without a fancy website or advanced tech tools, Noah built a simple payment system:

  • He created a basic landing page and linked it to a payment processor.
  • This no-frills setup was enough to start accepting payments for the Imgur Pro deal.

5. Launching the Campaign

  • With the Reddit ads in place, Noah launched the campaign.
  • Reddit’s engaged user base responded enthusiastically to the targeted offer.

6. Fulfilling the Orders

  • Every time a customer made a purchase, Noah personally emailed them a unique code to upgrade to Imgur Pro.
  • This manual approach demonstrated his commitment and kept costs low while validating the demand for the product.

The Results

  • 200 paying customers within a short period.
  • This early success validated Noah’s hypothesis and proved there was a market for discounted tech tools and services.

Key Takeaways From Noah’s Journey

  1. Validate First:
    • Before building a complex system or investing heavily, test your idea with a small, manageable launch.
  2. Leverage Partnerships:
    • Noah secured a product deal with Imgur and free ad space on Reddit through straightforward, genuine outreach. Partnerships can amplify your reach and lower costs.
  3. Tap Into Communities:
    • Reddit’s niche user base made it the perfect platform for Noah’s offer. Find and engage communities that align with your product.
  4. Keep It Simple:
    • Noah didn’t wait for a perfect setup—he used basic tools to launch and manually handled sales. This lean approach saved time and resources.
  5. Be Bold in Networking:
    • Cold emailing a Reddit founder and inviting them to breakfast may seem audacious, but it worked. Confidence and clear value in your pitch can open doors.

Conclusion

Noah Kagan’s success with AppSumo began with this scrappy, no-frills experiment that turned an idea into real sales. By validating his concept, leveraging partnerships, and staying resourceful, he set the stage for what would become one of the most successful platforms in the online tech deals space.

If you’ve got an idea, ask yourself: What’s the simplest way to test this today? You might just be a few bold moves away from your first paying customers.

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