Success Story of Video Husky: A 7-Figure Video Editing Company

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In this week’s newsletter, we will talk about the success story of Video Husky and its co-founder Justin Tan. How Justin started Video Husky and reached annual recurring revenue of 1 million dollars.

Success Story of Video Husky: A 7-Figure Video Editing Platform

Video Husky is a Hong-Kong based platform that helps content creators and companies by editing their videos, that are generally very time-consuming. They complete editing videos within very less time (less than 48 hours), while maintaining a high quality. There is no long-term commitment needed either! Adobe Premiere Pro and After Effects are the two tools used to edit videos.

Currently two plans are available on their website, namely:

  • Pom plan: This is available at $549 per month, with features like limited revisions, maximum rendered running time of 10 minutes, maximum raw footage running time of 30 minutes, maximum 20 GB raw footage provided, etc.
  • Eskimo plan: At just $749 per month, you can get features such as unlimited revisions, maximum rendered running time of 20 minutes, maximum raw footage running time of 60 minutes, maximum 40 GB raw footage provided and much more.

Justin Tan started the company in March 2018, influenced by the fact that though video advertisements were getting popular, no one could edit them hassle-free. He wanted to build a 7 figure company of his own, earning lots of revenue and fame through it. Inspired by Design Pickle, he set a self-goal of having 10 customers within 90 days. He promoted his product through Personal network, Facebook Groups, free trial on Discord, but in vain. Though he was demotivated, he didn’t give up. Finally, when his Discord thread got a boost, the goal of 10 clients was fulfilled, earning a MRR of $5K. However, in June, he was left with only 5 customers. This was mainly due to the mismatch between his product and the market, and lack of promotion and marketing. But Justin knew that every cloud has a silver lining. He decided to take the help of Alex McClafferty and Russ Perry, both having experience working with business services earning in 7 figures. They made him realise the potential of Video Husky and think about other outlooks.

After speaking with the remaining customers, he understood that those who had previously taken external help for editing were happy with the output given by him and stayed back. Those who left had knowledge and experience of editing and were fed up with the time it took, but they didn’t realise the value of taking external help. This determined the target audience of Video Husky, comprising of the former type of customers, and what their demand was.

Now that the foundation was laid for the improvement of the product and the marketing strategy, the main task was to pitch their product to the potential clients. They wanted to pay attention to hiring and contracting out the work, rather than editing themselves. Taking ideas from the book Traction, Justin used cold mails to attract customers, that initially brought in 10 new customers, however these customers were mainly Youtubers who edited videos themselves. Since this was not the target audience, he used Facebook ads as a source of paid advertisement with the advantage of filtering out ideal customers. As a result, many clients purchased the product and remained for a long time. This led to a 10-12% revenue growth rate for the next year, enabling him to employ more editors.

Soon, another trouble came in Justin’s path. As the team grew, so did their problems with the leave policy. He wanted people to work on holidays while taking leave on other days, but the staff didn’t agree to it. After knowing about the mutiny from his managers and old team members, he introduced Decembreak – a week of holiday. This made both his team as well as the customers satisfied.

After new year, Tan noticed that Video Husky didn’t enjoy the same profit as before, besides the growth rate being too low. In fact, it was barely earning break-even profits, fetching around $500 monthly salary for him. Though this was acceptable during the initial stages, he decided to do something about it. Through CleverProfits, a company that helps online platforms earn profits through the method of Perfect PnL, he realised that he was focusing more on marketing – excessive advertisement expenditure and lack of capital stock of the company. Not hiring better employees and bearing losses with little savings were taking a toll on the profitability. This was emphasized by losing 30% of the clients and revenue during the COVID-19 pandemic. He then had to take some tough decisions – firing 16 employees, reducing the salary of the remaining ones by 20% and himself taking nothing home. Finally, the tables turned after accruing loss of $10K for two months simultaneously. By the end of 2020, Video Husky was again earning profits, and both he and his team could take home their previous income.

However, he finally decided to address the elephant in the room – the loss of clients even before the pandemic. Getting inspiration from the book Pumpkin Plan by Mike Michalowicz, Justin sorted the customers according to the long-term revenue and the troubles they brought with them. Also, the editors were ranked according to the attrition rate. Through the statistics, he came to know about the best clients and took a survey to take their response and feedback. Most of the demand was for talking head videos that needed to be edited twice per week and were obtained correctly in the first try without any revisions needed. In response, only such videos were marketed and editors with this skill were only hired. The existing editors were given a training of 6 months that improved their skills and knowledge. This caused a much higher customer lifetime value and lower customer acquisition cost, resulting in record revenues.

However, the passion with which Justin started Video Husky soon burned out, and he was getting tired of the effort it required. In 2021, with the help of his colleague Taylor Pearson, he understood that rising organizational debt and the resulting need to restructure the company, pressure of team management, and the absence of a vision, were some of the things that bothered him. All these culminated into a lack of association between him and his customers, and between him and his team. He couldn’t connect with the new type of customers – video creators like Youtubers – and thus couldn’t understand their needs and requirements. Similarly, he was scared of solving the problem of the rising debt, as it could make things worse. Tan hated the managerial roles associated with his post – he just wanted to lead a simple life. He realised that his company needed a new leader – either he had to sell it or recruit a general manager to fulfil the duties. But he was reluctant to leave his brain-child into the hands of some unknown person, and therefore hired Federico as the manager so that he could still remain personally involved. Though after the handover they had weekly meetings till October and bi-weekly meetings till January 2022, there were still problems remaining to be addressed.

Justin soon came to the realisation that the main obstacle for the growth of the company was he himself. Since he was so unattached with everything, he couldn’t make sense of whatever was going on, and as a result, Federico was the one suffering from both sides for defending him to others. Knowing about his own shortcomings, Justin decided to give full independence to Federico and left everything under him. He was just a titular owner now, and they would meet once in every 90 days to give the minimum stipulated profit.

Through the entire journey, Justin Tan learned many lessons. In the initial stages, when he started from scratch, he realised the benefits of building a community and developing a product within it – taking feedback, reviews and working on them. After achieving every small milestone, he gained confidence that pushed him to newer heights of success. When he hit a bump on the road, taking help and advice from others helped him learn and experience new things. They kept him grounded, and made him understand his own potential. After that, focusing on factors such as product development, suitable market, traction channel, advertisement and promotion, etc., helped him earn good profits. Besides these, he also learned to let go of his pride and take care of his employees, keeping them happy. This is what a true leader does!

His efforts and hard work paid off well. Even after facing so many hurdles, he was driven by the profit motive and thus didn’t give up on his dreams. At the end of the first year, in February 2019, Tan and his team of 17 reached a MRR of $23K, with 51 customers. By September of the same year, Video Husky reached a MRR of $83K, with 100+ customers. As a leader, Justin had taken the company to an ARR of $1.2 million, earning $100K+ revenue per month.

But the main lesson was learned when after a long period of time, he understood his role as an owner and not just a seller. Though he started Video Husky as a pet project, he realised that many lives and their earnings depended on it, including his own. He became serious and disciplined, and gave his everything for the company. Though reducing the customer base as well as the team was hard, it ultimately proved profitable, taking the revenues to another level. Better communication, team effort and determination brought the company to a new height.

But sadly, all good things do not remain forever. After his hunger and interest died down, he realised that for the good of Video Husky, he had to let go and move on. At first, he tried to stay involved by giving inputs and orders, but since it proved to be worse, he gave up his authority and became the owner just for the namesake. This was a generous move from him – giving others a chance to prove themselves and do wonders for the business.

Justin is now satisfied – his company is in good hands and earning a good amount of revenue. His staff and customers are satisfied and everything has worked out well. He is now thinking more about his own future – where he would go from here, and what would be his next move.

Though having problems can be depressing, it’s a part of life. The real challenge is to overcome and work through these problems, and this is what pushed Justin till the end. In fact, even you should take some motivation from his journey. Remember, to be patient and never give up – only then can you taste the sweet fruits of success!

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Aditya

Founder, Moneymint

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