Wanderly Update: Feb 2024

How following scaled best practices can still help bootstrapping

I recently wrote an “investor” update, even though I’m bootstrapping. It was a great accountability exercise, so I’m posting it here in the spirit of building in the open. I’ve redacted some of the more sensitive things.

Writing this up forced me to do a few things:

• Really understand my acquisition funnel. I knew this would be the first thing I would be asked, and I needed to be confident in my conclusions.

• Dig in on marketing. I’m a product person, and marketing is a growth area. This update forced me to get clear on target audiences and market size.  

• Reconcile my priorities with reality. Due to the chaos of the last few months, I had things I wanted to build but hadn’t validated my intuition with data. Now, I know a few things I need to prioritize differently. 

Although I initially wrote this up for a couple of close confidants, if you have advice or thoughts, I’d love to hear them. 

Summary

Wanderly is still very early, but there are signs of life. I’ll be working on retention and quality as my primary goals in the next 6 months. I’m optimistic that upcoming changes will cause Wanderly to hit a new inflection point. 🤞

Highlights

• 2 subscriber monetization highwater marks: Revenue and new paying subscribers per month (X).

• The mobile app is a week or two away from being code-complete. 

• Revenue doubled in Dec due to gift cards (~$Y in subscriptions and $Z in gift cards). 

Lowlights

• Retention is not great, but there are little to no retention techniques right now. I hope to address this with upcoming product improvements, mobile app notifications, and experiments with lifecycle emails. 

Requests

• I’d love suggestions for managing accounts and/or taxes as a very small business. 

• I’d love thoughts about which metrics to make my north star(s). 

• I’d love a brainstorming partner for refining my “What is Wanderly” pitch and messaging.

Favorite recent user quote

"My dyslexic, 4th grader struggles with reading and comprehension. She went from absolutely dreading reading to choosing reading over playing outside and then hiding under her covers after bedtime with books… all in about 3 weeks because of Wanderly!" - Bill

General Orientation

Since this is the first update, I’ll start with some context setting on vision and progress-to-date.

Wanderly: Magical Adventures for Curious Children

Wanderly is a story-driven educational app that encourages curiosity and imagination. Imagine choose-your-own-adventure stories, personalized picture books, play therapy, vocabulary-building stories, and mad libs all had a baby. This is made possible using Generative AI tools, specifically LLMs and text-to-image generators. 

My goal with building Wanderly is to build a self-sustaining business that inspires and educates children while also deepening connections with family. In using Wanderly with my own family, I’ve found a few things:

• It’s cooperative screen time that I don’t feel guilty about

• I’ve found out more about my child (her interests and her friends) than I ever have just asking her questions

• Wanderly provides a very cool springboard for imaginative play and conversation beyond the app

I hope that families that use Wanderly will have the following outcomes:

• Increased visibility into their child’s life and choices

• Increased connection with family members

• Increased educational outcomes as a result of vocabulary and information exposure

• Increased child confidence as they get to make choices and play in their own imagination landscape

How Wanderly is Different

Here’s a rundown of other AI-stories-for-kids products via the lens of their approach and one thing they do well. And if you have other products you think are worth looking at, please flag them. 

Substack doesn’t do tables, so this is a screenshot.

Overally, Wanderly is the only product that leans into kid-agency in storytelling and story quality. Wanderly really leads with the choose-your-own-adventure style storytelling; [redacted] is the only story system that even has an option, but it’s buried. Wanderly is the only product that adjusts the reading level for the child, and I can also tell from each story engine’s prose that little tuning has been done (there are certain tropes that OpenAI’s GPTs do by default that I’ve had to work hard to suppress, like overuse of adjectives and adverbs, trite summaries at the end of each story, etc.). 

It’s also worth noting that there’s a lot of churn re: the creators of these products. Older players have moved on or are creators who view these story creators as side-projects. Some new entrants seem to be taking it seriously with small teams. I think the reason is that, although AI-created stories seem initially interesting and you can get a demo up and running quickly, making *good* stories with AI (good enough that people want to keep coming back) takes a lot of elbow grease. As a result, there were a lot of entrants when it seemed easy; now that easy isn’t proving to be enough, those who were in it for a quick buck are exiting (that was definitely the case with [redacted]). 

Target Market & Sizing

Overall, I’m targeting a US market and kids aged 3-12 (with a light hypothesis that 3-8 might be the sweet spot, but I’m still learning). I have two narrower markets that I’m eyeing as starting niches:

• Homeschooling families

  • Why is Wanderly a fit? Many homeschooling parents have control over their choice of curriculum and tools. They tend to be oriented around tools that give more agency to their child while learning and are interested in culturally responsive education (top reasons for homeschooling), which is a sweet spot for Wanderly. Wanderly is child-led and open-ended, which are key Montessori principles, too. 

  • What is the market? Spurred by the pandemic, homeschooling is accelerating in popularity. There are about 4.3M homeschooled kids in the US, with ~2M in my target audience (source). Homeschooling families typically spend $500-2.5K per year on materials and extracurriculars (source).

• Learning differences families

  • Why is Wanderly a fit? Wanderly has gotten some very positive feedback from parents of children with dyslexia and ADHD. I mostly have anecdotal evidence here, but I hypothesize that 1) personalized stories and 2) short bursts of reading followed by interactivity are key to keeping their interest. Parents of these children are interested in finding any resource that will help their child practice reading skills, which can be challenging. 

  • What is the market? Research seems to indicate that 1 in 5 US students are dyslexic (source), and roughly 10% of students have been diagnosed with ADHD (source). 

Progress to Date

Wanderly started as a “let’s see how far we can take this” kind of project back in Feb 2023, and I kind of fell in love with it. Here’s a snapshot of what’s been built and how the product is doing:

• Technical assets - React web application (and soon-to-be iOS / Android app) using AWS Amplify to generate illustrated stories. Story text uses OpenAI GPT-4. Images are pre-generated using Midjourney and are matched to stories using keyword matching. Monthly subscription enabled via Stripe.

• Business assets:

  • XK registered users, but mostly dormant. 

  • ~Y monthly subscribers @ $15/mo, Z annual subscribers at $135/yr, and $X in gift card purchases during the holiday season. Y new subscribers this month (a new record), but several unsubscribes. So far, the investment is bootstrapped from personal finances, and I expect to continue that through EOY unless there’s a major growth inflection. 

  • I have deliberately decided not to put gasoline on yet (e.g. Product Hunt, reach out to Xoogler network, etc). I’m hoping to get retention figured out before doing that.

• Marketing assets:

  • Marketing site at https://wander.ly with a 25% user conversion rate for clicking through to the login page.

  • Facebook and Instagram followings of ~300 users, all paid acquisition.

  • I’ve seen the most interest from users of parents who have a learning difficulty (esp., ADHD and dyslexia) and homeschooling parents. There have been a few inquiries from teachers but little follow-through. 

  • I don’t think I’m nailing the marketing pitch yet. I think it’s easy to say Wanderly is a story app or even a story-driven educational app, but it doesn’t yet get to the heart of the child-led and open-ended aspects of the product. 

Metrics in 2024

I’ve been working to identify what metrics I should be tracking and driving forward. Right now, I know revenue is a long-term goal but not the key metric for decision-making. Retention and active users are a classic but might be too abstract / trailing indicators. 

Here are some things I’ve been looking at, and I’d love your thoughts on which of these metrics should be my north star:

• ~$X/user with Facebook ads to acquire a new user who creates their first story

• New user attrition in Jan:

• Story quality in January

  • Average story rating (only for completed stories): 4.62

  • Average story completion rate: 45%

    • First story completion rate: 32%

    • Subsequent story completion rate: 57%

  • Average stories/user: 1.88. Here’s how many they created in Jan:

    

What’s Next

For the purposes of a public newsletter, I’m not going to lay out my entire new feature roadmap. 🙂 What I will say is that I’m planning on launching a new story wizard and a native mobile app in the coming weeks, which should address some retention and onboarding issues (as well as some feature requests from my #1 user: my 5-year-old daughter). I’ll also be working on user lifecycle emails and cultivating a group of users to give me regular feedback. Beyond that, you’ll have to wait for the next few newsletters. 😉