Steven Sacks Reddit AMA Highlights*

  1. When we started the donation drive, we had 3 weeks left. As we continue to get donations, that gets extended. Every 16.66% we raise is another month.

  1. We are experimenting with ads to see how much revenue they bring in. As of now, it looks pretty small and not worth doing. The reason is that 75% of our users have Ad Block installed.

  1. Question: Why were bouncers and RDJs limited? Some communities were out of control with their staff (2500+) and it was causing major server load. Nobody was pruning their old staff members who no longer logged on and it got out of control. We're trying to control costs and this was one of the most expensive server calls.

  1. We are trying to raise 6 months of operation costs. Roughly $360,000. We have done numerous things to cut costs (and will continue to). We have let people go, shut down our office, and the 3 founders are getting paid minimum wage (legally, that's as low as we can go). We are also rewriting portions of the backend in Go to require a lot less server boxes to reduce costs there. We are looking into further cost reduction strategies, as well.

  1. $60k / month, $2000 / day, $1 / minute. If 60,000 community members (6% of our total monthly traffic) each paid $1 per month, that would be enough to keep going in survival mode. If we could get 100,000 (10%) people to pay $1 per month, that would allow us to do things like mobile, etc.

  1. Question: why did you let the artists go? Couldn't afford them anymore. Our investors told us we had to get our monthly costs down to a specific number and we did. The founders are all getting paid minimum wage now.

  1. Very few people liked the Plug Notes system. We needed to give it some time and experimentation to see that. We switched to subscriptions and epics a few months ago, and while that was more popular, we only have 3500 subscribers which is nowhere near enough. Investors wanted to see 4-10x that amount. This wasn't due to mismanagement. People really have no idea how expensive it is to run a tech company even as frugally as we do.

  1. We discovered that the old avatars were built on artwork that was not paid for or licensed and the fees were really expensive. That artist was also no longer available. We hired a new one and that was the style that we got. We liked them and were surprised so many people did not. We did what we could to improve them over time. Enough people liked them that we felt that you can't please everyone.

  1. Unfortunately, there will be no new avatars or backgrounds unless we can get 100,000 subscribers to pay $1 per month. We had to cut costs to survive.

  1. Backgrounds take about the same amount of effort as 2 avatars. But, there are much less communities than members. So, who would buy the backgrounds? Would it be the community host? Or could we create like a kickstarter-type thing where people could contribute towards buying a new background? Because we would be selling less of them, because it would require significant development costs and art costs to make this system available, they'd have to be expensive to make up for it. Who would pay $100 for a room background? $5 wouldn't cover the costs like avatars. The math didn't add up, as cool as it would have been to do it. Selling backgrounds would only make sense at large scale, like if we had 10,000,000 users a month.

  1. sixside’s response to background/avatar question: Custom avatars are extremely expensive and time consuming to make. Now plug avatars are not nearly as complicated or expensive as that ^ but still. It's not cheap or quick. At our size we need to focus on avatars that (hopefully) appeal to a large number of people since we had a very small art team that could only create so many avatars at a time.

  1. Question: What will happen to the money that has already been donated if plug doesn't meet the required goal? Answer from sixside: It's being used to extend the life of plug as long as it will allow for.

  1. Question: How many days left of Plug are you currently sitting on right now? How long will Plug run with the current funds/savings at the moment? A little bit into October. Please donate to extend it and get your friends to, also. $1 for every month.

  1. Question: How is the fundraising going? I wish it was going better. We have about 60,000 people who use the site every day or every weekend, and hundreds of thousands more who use it less frequently. If each one of those "hard-core" users donated $1/month or if only 20,000 of them subscribed for $2.99/month, our costs would be minimally covered. Right now, we only have 1528 donators who have donated an average of $10.77 each. We need a lot more donators to just donate $1-$6 each. Here's what I struggle with personally. 60,000 people love and the community enough to use it everyday, but only 2.5% of them think it's worth just $1/month for something they use every single day. That's only $0.03 per day.

  1. Question: would plug ever be back if it was forced to shut down? Unfortunately, once we're done, we're done. If the people who love the site now aren't willing to pay $1/month now, they most certainly wouldn't be willing to in the future.
  2. 1528 people have donated an average of $10.77 each. We need a lot more than that if we're going to survive in the mid-to-long term.

  1. We are discussing making a new subscription tier for $1/month. If you are not a $1 subscriber, you can still use the site, chat, dj and vote, but you will only be able to have 1 or 2 playlists, and host 1 community with no staff. Once you become a $1/month subscriber, you can have what you have now. Unlimited playlists, 10 communities with staff, etc. For existing users, we would let them know that they have a limited time frame to sign up for the $1/month subscription. This is pretty extreme, I know. We're not exactly happy about the idea. I think a lot of people would get upset, as well. But what's more upsetting? $1/month or no anymore?

*This is a rough summary of the AMA that took place yesterday, put together by chadtz. Please read the actual AMA for all questions and answers here!