Katie Keith:
Welcome to Do the Woo, the podcast where we talk about all things WooCommerce. I’m Katie Keith, founder and CEO at Barn2Plugins.

James Kemp:
And I’m James Kemp, the core product manager for WooCommerce. Today we’re going to be talking about building a marketplace on WooCommerce with a special guest who we will introduce shortly. We had an episode a month or so ago, uh, talking about running a marketplace, uh, running the WooCommerce marketplace specifically. But I’m looking forward to seeing, uh, from a, a merchant’s perspective what it’s like actually, you know, creating their own marketplace.

Katie Keith:
Yeah, should be good. Now, if you are watching live, please ask your questions and share your own experiences of building or running WooCommerce marketplaces in the comments wherever you are watching this.

James Kemp:
Yeah, and before we dive into the topic, you can subscribe on dothewoo.com. Uh, all the links are over there, but we’re Do the Woo Podcast on YouTube and Do the Woo on X.

Katie Keith:
Yeah, so now let’s get back talking into multi-vendor marketplaces. To discuss this, we’ve invited Mike Maloney as our guest Hey, Mike.

Mike Moloney:
Hey everyone. Thank you guys for having me on the show today.

Katie Keith:
Yeah, well, thank you so much for coming on. We always love to talk to real WooCommerce merchants. To get started, could you tell us a bit about yourself and your work with WooCommerce?

Mike Moloney:
Sure, sure. So I’ve been doing WordPress WooCommerce websites for a little over 12 years now. Initially, it started as a design blog, this website I was doing. It was called Web Element and it was just a fun thing where I was kind of learning about content marketing, blogging. And this was so long ago, it was like way before all the changes to Google search and these other things. And then one thing led to another along with a lot of like design practice, Photoshop, things like that. And then eventually I started getting into building photo filters and that is what kind of sparked the idea for FilterGrade, which is the marketplace that I now run. And, um, yeah, that was kind of like the start of the journey. And FilterGrade now is a larger marketplace that supports almost 3,000 sellers, and it’s all digital products ranging from the initial kind of core category, which was photo filters for Photoshop, Lightroom, uh, Capture One, to now support things like video LUTs and video filters, templates for motion graphics, Notion templates, any pretty much anything that kind of revolves around like visual creative digital products. Um, we’ve expanded into some other extra categories that we’re testing, but those are like the core foundation of what we’re doing.

James Kemp:
Yeah, it’s pretty cool because, uh, for anyone that follows me on X or has known about my past, I do a lot of photography. Um, and one of the sites that I used to use when I used LUTs, um, which I don’t tend to use LUTs that much, uh, other than like, you know, the ones I already have.

Mike Moloney:
Yeah.

James Kemp:
Um, was, uh, was FilterGrade. I used to get a couple from there, so it’s, uh, pretty cool to, to be chatting with you.

Mike Moloney:
Yeah, likewise. Thank you for supporting FilterGrade over the years too. That means a lot.

James Kemp:
No worries. Let’s dive into FilterGrade. I think it’s a cool story to kind of dig into. Based on your introduction there, it seems like you were maybe coming from this space where you already build websites and, you know, have experience with building websites. And FilterGrade came as a part of that path. Yeah. What, what’s the story? What was it?

Mike Moloney:
Yeah, yeah. So it’s kind of a fun story. Basically, like, I was a really curious kid. I was selling my digital products on Envato Marketplace, which at the time they had a bunch of different ones. They still have them. One was called Graphic River where I was selling these filters. Um, they also had ThemeForest, which many people in the WordPress world know about. And so I was really like trying to figure out how to kind of monetize my passion. I was literally like 14, maybe 15 around that time. And I met a buddy of mine now who’s like a mentor and friend who I always like to shout out. His name’s Adam McIntyre. He’s also in the same space and he was the moderator for their forums. And he told me, you know, you got to brand and build— like I was going through my name, Mike Maloney Digital Products, you know, just like a classic kind of first business. And it was a lot of fun. I was making everything ranging from photo filters all the way to, at the time, people sold Facebook cover templates and random little things. And I had a good time with it, but it was still always on my mind to grow into something bigger. And he had already had multiple websites in the space. One was called Flyer Heroes that he eventually exited, and it was all Photoshop flyer templates. And so he He was a huge help in giving me the idea, really encouraging me. And it started with just an initial set of, I think it was 12 or 15 products that were individual and then bundled up. And the bundle was definitely a key learning point of how to drive more sales. I’m sure, Katie, you probably have learned that with the plugins business. When you bundle stuff, it can really do well and drive crazy revenue that you might not have expected from one product. Yeah. But I launched the bundle on— so initially I didn’t actually start it on filtergrade.com. I launched it on Creative Market, another marketplace in the space. And I talked about this in a few different articles on my Medium account, which I’ll share, or we can share later on. And it’s basically like the idea of using a marketplace as an MVP. And ironically, it was for another marketplace, like I launched the shop, sold those 12 or 15 products in the bundle, and used it to fund initial development. And so it started with, you know, 6 months of selling them, figuring out what people liked, how it was going. And these were just Photoshop filters, which is not really one of our biggest categories anymore. It kind of has come and gone as the market has changed. But fast forward 6 months in, Filtergrade was starting to get more traction. And so it was my first time doing— using WooCommerce. And so I literally bought a theme from ThemeForest, and then I launched like the proper WooCommerce website for Filtergrade. And it started with just our products, and I made a few more, you know, to make it fun. Learned all about building like a store on the web that wasn’t just through a vendor or a marketplace platform, but was our own. And there’s a lot of challenges that come with that, you know, understanding how to integrate PayPal, Stripe, those things. And WooCommerce does make it really easy, but there’s still layers of support and things that you have to understand, like fraud protection, all these little things that, like, when you’re selling on a major site like Amazon or Etsy, you’re probably not going to deal with as much. That’s kind of their business. That’s like the whole point. And so in this, you know, I spent a whole year just doing that. FilterAid was not making a lot of money. It was making maybe $500 to $1,000 a month just selling our own products. It wasn’t very sustainable. Um, and at that point, I was a little bit older by then. This is like fast forward, you know, this is a couple years in, so I was probably 17, 18, and I was in college. Um, I went to college for one semester, and I was convinced, you know, this was the next big business. So I ended up dropping out of college, which my parents were not super happy with at the time, but I had a dream. I had a belief in what I was building. And that year is when things really started to become more real because I was fully immersed in the business and I was like, okay, how do we turn FilterGrade into something that is sustainable for not just me but other creators? And that was kind of the light bulb moment. Um, this was when you guys might remember when Instagram was really big for photography. This is pre-Reel, pre-video. And so I noticed all these people were like posting their photos and everyone was in the comments saying, how did you get that look? How did you do this edit? You know, what, what is, what is your secret recipe? And I found one photographer who was selling his presets through kind of like a hacked together Shopify website, or I don’t even know, it might’ve been Squarespace. I don’t even know what he was using, but it was horrible. Like, you wouldn’t get the download link. He was struggling to maintain it. It was complex and it led to like, I think he was a little frustrated. And so I just reached out and I was like, hey, would you want to list your products on FilterGrade? And we kind of DM’d back and forth. We struck a deal and this was the only product we ever really paid for, so to speak. We paid him a flat fee and then we also split revenue and he was the first seller. And instantly, like, you know, he promoted it. And we, we got a lot more sales than normal with like my own products, which didn’t have an influencer or a name attached. And so that was kind of the start, and then things snowballed. We got like 50 to 100 photographers on there, and that became the FilterAid Marketplace. And by 2017, the marketplace was doing anywhere from like $10,000 to $30,000, almost $40,000 a month. I think our record month was like $50,000 or $70,000, which was like mind-blowing to me as just like a bootstrapped entrepreneur, no funding, no understanding of like anything. And, um, yeah, that was like, that’s like kind of the story. And then over the years we’ve optimized and added new categories. Like video wasn’t even a category at that point. It was all Lightroom presets almost. Um, that was what most vendors sold. And then through there we’ve kind of kept the marketplace alive amidst all the changes to the web since then.

Katie Keith:
Yeah, I think that’s amazing. And Um, this is a slight tangent, but, um, I, I bet people really judged when you dropped out of uni to start your business. And that’s a bit of a bugbear of mine, that entrepreneurship, starting a business, isn’t seen as kind of a valid career path for young people. But if somebody’s motivated and has an idea, I think it’s a— you can do so much better than all the people you know with traditional jobs, and nobody ever knows.

Mike Moloney:
Yeah, yeah.

James Kemp:
I mean, when I was at school, it wasn’t even like recommended. There was no Because we did a work experience where you had to, like, choose a place to work for a week, I guess. And that just wasn’t, like, encouraged or an option. Like, you didn’t even know that existed. I think I went to Homebase, which is like a retail store for—

Katie Keith:
DIY shop.

James Kemp:
Merchants. Yeah, like DIY type shop.

Mike Moloney:
Cool.

James Kemp:
Which was an experience. I will admit. Yeah. Yeah, it’s interesting. Your story is very similar to mine, like in terms of like when I started selling digital products, it was on CodeCanyon, which again is like an Envato marketplace. And eventually, you know, that was under my own name and eventually moved to realizing that this could be a business and branding it that way and just kind of, you you know, experiencing that change of, of what that looks like and considering, like you say, the, the different challenges you face with, um, you know, when you’re on a marketplace, typically they handle all the tax and everything, uh, and, and the systems behind it, uh, and then moving away from that, it becomes something that you have to deal with. Um, so yeah, it’s interesting to hear. I bet there’s tons of similar, you know, entrepreneurs that started on the Envato marketplaces and transitioned away over time. But I also know there’s quite a few that stayed there. Like the Flats theme are still selling on there. And I think they were one of the biggest, you know, themes at the time.

Mike Moloney:
Yeah, it’s an incredible platform. I have a lot of respect for the Envato team. I know, like, they recently got acquired by Shutterstock, I think this year or last year. Still to this day, it’s one of the biggest platforms, and it’s— it was one of the things that inspired me to start our own marketplace. Same with Creative Market. It was the idea that these are like— you’re building something bigger than just your own product catalog, but you’re building a platform to enable anyone across the world to list and sell digital products to, you know, support their family, support their livelihood, but also to eventually start their own business. And maybe it’s a marketplace, maybe it’s a theme shop, or maybe it becomes an application. You never really know. But that fascinated me. And early on, it was one of the north stars that my brother, who’s also the co-founder, Matthew Maloney, we kind of identified one of our north stars was like helping creators earn money online. It was just like a core value and it led a lot of the decisions we made. And sometimes that hurt us because we cared so much about making making sure they were making a good living that, you know, from their products that we had trouble scaling the marketplace without that external funding. And so I think, but yeah, back to like the Envato stuff, it’s, I met a few people on there at the time and they’re making significantly more than like our entire marketplace. So it just shows the scale of, especially like the themes business, plugins, you know, CodeCanyon, things like that.

James Kemp:
Yeah.

Katie Keith:
And once they’ve reached that tipping point, people are going to, like you, are just going to sign up to sell with them because they know that they’re going to bring them customers. So I’m curious to know how you start a marketplace from scratch where people don’t know that you’re going to bring them customers and the eyeballs that they need to sell products. How did you find your first 100 sellers, for example?

Mike Moloney:
That’s like a great question and it’s something that in the moment we didn’t really recognize and then it kind of clicked. There was 2 sides to it. One was my interest in content marketing and other forms of marketing really paid dividends because all that experience I had with blogging and other things, we were able to generate quite a bit of traffic for the sellers from the start because we had an active blog, we had social media presence, SEO kind of understanding. And that was also one of the selling points to get those 100 sellers on. They didn’t want to deal with some of the problems that come with, like you said, selling your own products, taxes, even just like cover images, uploading files, formatting. And so it was a bit of like them knowing we had somewhat of a platform. And then also my brother and I quite literally hand onboarded all the first 100 sellers, maybe more. It was probably like the first 300 to 500 sellers, which is like insane to think about. But we would do things like we made cover image templates and before-after image templates. And so we did a lot of things to make it easy for them. And because of that, and because of at the time it was such a popular thing, um, in terms of like it was so new that everyone wanted to buy filters, a lot of sellers saw revenue very quickly. And so that helped as well, um, especially because of the kind of like snowball effect. Like we had that one seller Then we kind of emailed 10 or 20 more, they joined. And with those first 30 or 40 people, it was like a frenzy in terms of people, you know, come on filteraid.com and then they’d see, oh, like, I recognize these 4 photographers, let me add them all to my cart and buy it all at once. And so as a vendor or a creator, they got the benefit of exposure around these other creators who were already familiar to their audience. Um, it was like, you know, Kind of like this ecosystem. And even to this day, it’s still a value add that we have of like, there’s plenty of people who are large enough, they sell on their own, but being on FilterGrade exposes you to customers from all those creators. And we try to do a good job of, you know, cross-promoting products while still valuing the original creator. We designed the product pages to like highlight their items, but also to show relevant items that are adjacent, you know, from similar creators or Let’s say like you buy a preset, you can also buy a LUT, you know. And so these little things were beneficial things, along with like doing product support for vendors, helping them understand the SEO behind their products. Like a lot of creators at the time would sell filters and it would be like a landing page with a simple title, a few images, maybe just a cover image, and then like a one, you know, sentence description like, hey, these are my Lightroom filters. And we would help with optimizing the description so that it was not only beneficial to search engines but also beneficial to the reader, the customer, of like, what am I gonna get, what products are supported, like what versions of Lightroom. And even things like that on the blog, we have hundreds of tutorials like how to install presets, how to do this. We have video tutorials. And so it was kind of like this holistic approach of we’re gonna do as best as we can to provide a full kind of like experience for your customers and for the vendors. And all you have to do is kind of send us the products. And then after the first, you know, couple hundred vendors, now things are a lot more automated. But it was the same idea of like, we’re gonna give you the most easy tools possible to log in, you know, fill out the form of like your title, your description, upload your images, upload the zip file. and add a price and then list it publicly. And it just, once you’re approved as a vendor, it just immediately goes live. Every product shows on the homepage, you know, until more products roll out. And we try to distribute as much as we can for our vendors through categories, tags, landing pages, things like that.

James Kemp:
I think there’s a few points to touch on there. It’s interesting to think about the kind of scope of a marketplace where every new person you bring on board is essentially someone that’s also going to do marketing for you.

Mike Moloney:
Yeah.

James Kemp:
Um, they’re gonna, they’re gonna talk about the marketplace, they’re gonna send, especially if it’s the only place they sell, you know, they’re gonna start sending people there. Those people are gonna find other products, um, and it can be, it can act as quite a sort of exponential or viral, uh, approach to selling products. And it doesn’t have to be Digital only.

Mike Moloney:
Yeah,

James Kemp:
yeah,

Mike Moloney:
yeah.

James Kemp:
It’s, it’s a, it’s an interesting model for sure. Um, you mentioned that obviously the, the first batch of vendors that you onboarded was very manual, um, and now it’s a bit more automated. Have you explored or considered how, uh, AI might help to automate it even more in terms of like, can your vendor just like describe what they’re uploading and it creates the description and images?

Mike Moloney:
Yeah, that’s something we do need to look into. We’re not quite that sophisticated yet. I wish we had some of those features. I’m sure that that’ll be down the road. I think we do have some tools to help vendors with like understanding descriptions, but you’re— we don’t have specifically AI and we honestly haven’t adapted as well as I’d like to with AI. It’s been a very like cautious, um, couple of, you know, years because unfortunately a lot of people have shifted away from these types of products and they’re using the AI models themselves directly or things like for video, um, like, uh, I think it’s Runway and Kling is another model and then Higgsfield. Mm-hmm. So where like they can kind of do everything in the models and it’s hard to bring LUTs or filters into the equation. And so in to combat that, so to speak, we’ve kind of tried to stay a little almost away from AI, which AI would help with things like that. And I don’t think it interferes necessarily with like, because some creators are very anti-AI, which I’m sure you’ve come across as well. Yeah. Um, but for use cases like that, it could really help with like SEO, product descriptions, things like that. translating, you know. Um, but we have automated a lot separately from AI, and that was much earlier in the kind of equation around— I think like the first few sellers we uploaded manually and there was no tracking, so to speak, or there might have been, like it might have been pretty manual. But pretty quickly after we got like our first 10 to 20 vendors, we got the Woo Vendors plugin. I think that’s the name of it, or it’s like WP Vendors. And Um, I think it’s made by WooCommerce officially, and it’s literally like their version of a marketplace plugin. And that was like a big asset for us because I’m not very technical. Like, I know some things about coding and stuff, but I’m not like hand coding, you know, uh, WordPress theme or plugins. We mainly rely on a few of our team members. Like, I have a, like, a contractor who does a lot of like the technical stuff. And so we integrated that plugin and that was like the biggest way we were able to change from manually uploading to basically building an entire front end for the sellers to where they can simply log in. Once you’re approved as a vet, like you can even apply. Once you’re approved, we just do that all through the WP admin. And then once you’re live, you just have like this dashboard where you can add products, customize your profile. Which is another thing that we wanna expand on is like discovery of creators. And then from there, you know, track your sales, set your email for payouts, stuff like that. We still kind of do some things manually, like payments to the vendors are manually done every month by me because there’s so much risk with, you know, like that getting mixed up and we don’t have infinite cash flow to just like send a second mass payment, you know? Um, but other than that, yeah, like there’s a lot of stuff that’s still, I wouldn’t say manual, but just like done by hand and it’s kind of reliant on every vendor to do it themselves. And I think there’s pros and cons to that. I think I would like to explore a lot more technical features and I’m trying to stay up to speed on, you know, all the latest things because things change so fast.

Katie Keith:
Yeah, that brings us to quality as well. So if they’re uploading their own stuff and they provide the products, um, how do you maintain that? And I say that with a lot of knowledge of ThemeForest, which has developed quite a bad reputation in WordPress circles because of the certain elements of the themes, such as being overly bloated, not performant, things like that. So, but each one comes from a different seller and yet somehow they all managed to get the same reputation. If it’s a ThemeForest theme, it must be bloated. So how do you avoid that and make that like a positive rather than a negative?

Mike Moloney:
That’s another really good question because it was one of the biggest things like early on that benefited FilterGrade and then over time came to give us some problems as well. We, in the early days, it was like very curated. We picked all the first, you know, 100 sellers, like picked in terms of discovered them, made sure they were like a valuable, like, you know, they had some type of product that wasn’t just replicated or you know, very generic. And so it was like most of the products were named things like— I’ll just name a few like popular products— Monarie Lightroom presets or Aaron Brimhall Lightroom presets. And so people were buying it for that creator’s style. And so we had this reputation of like— our first slogan was literally filters from your favorite photographers. And so it was very easy to— we had a good reputation because at the time people almost would associate us with like a small curated version of an Instagram or a VSCO or another platform like that where you could find the coolest, rarest filters from literally like the top photographers around the world. And then as we scaled, you know, we reached like a bit of a ceiling where there’s only so many of those people you can attract to the marketplace. And eventually you’re going to have also people who want to apply and join for any reason, just like people like me you know, joining Envato or Creative Market, I wasn’t some big shot. I had zero Instagram followers when I did that. And so we had to figure out different ways to gauge quality other than just like initially a lot of it was gauged on do you have an Instagram following and can we visibly see that you have products that are— or not products, but like an editing style. After a certain point, we kind of shifted that focus and we’re kind of in the same boat now where it’s like Do you have some level of either existing products? Like a lot of our sellers will come from other marketplaces, um, and so they’ll just share that link in the application and we can see like if they’re already vetted on one of those sites, there’s generally good indication they’ll be okay. Um, do they have a Behance or a Dribbble or some type of design portfolio? Do they have existing YouTube videos or Vimeo videos that show they’re a filmmaker for LUTs? Things like that. And it’s really, again, it’s just me or a few other team members who are reviewing that. There’s definitely other vendors that have slipped through the cracks and there’s some that at certain points when we were struggling to find skill, we would just approve a lot more people and learn that the hard way. There was a few vendors who were selling books, literally just books from other publishers. And so we had to ban them. And over the years, we’ve also dealt with some really significant legal challenges. At one point we got sued for copyright infringement. And this was before I knew, you know, being a first-time founder, like especially as a marketplace, I didn’t know some of the rules, and at least in America around DMCA and copyright, like infringement on the internet. And so we learned really quickly, like how important it is to have some of your ducks in a row. Um, because we had 2 lawsuits against us that we had to fight in court. We couldn’t just ignore them and I couldn’t defend myself. And so. it was a pretty costly experience and really like stressful. And for, you know, the size of the marketplace, there were times where we wondered if it was worth fighting, you know, because there are very powerful companies, lawyers, and there’s a lot of money, you know, at stake for some people. And they know that they can kind of target platforms. And so to cut a long story short, like we figured out some things to protect ourselves. Um, one of them is like a DMCA shield that As a marketplace, sites like Creative Market, Envato, Etsy, even like YouTube, they all have these features where you can submit DMCA requests to take down products. And so that was like, just to like talk a little bit more about the behind the scenes of the difference between being an individual seller versus a marketplace. That was something we literally had to learn in US federal court the hard way, you know, and it was painful, but it was really educational to me, and I feel like I have a lot more knowledge that I can apply to all my businesses and all my projects. And, um, and that, you know, that also does tie into the quality factor though, because those— one of the lawsuits was related to blog images, but one of the images did come from a product that a vendor was selling, and we had no idea. Like, there’s 30,000 products on the marketplace, so we’re obviously monitoring it, but You can’t know every— that equates to literally probably half a million images. And so you can’t know every single image. And there are moderation tools out there. I’m really, really impressed with one. I don’t know the name of it. It might be called like Iffy, and it’s made by the founder of Gumroad, which is another platform in the space that’s super inspiring to me for digital products. And they’ve made some— there are some tools out there for vendors and marketplaces that aren’t like just for the big companies like Google and Amazon. But, um, really a lot of it comes down to using good judgment. Um, we had to literally build a feature like just last year for banning a vendor because it wasn’t really built into the WooCommerce or the vendors plugin, unfortunately, because I’m sure they don’t assume— like, there’s— it’s hard to assume every edge case with a marketplace, but you will find every edge case. You know, we had to like delete content that was not appropriate for work, you know, and you wouldn’t expect people to sell that or like post that with their filters, but it’s all like anything goes on the internet and people are going to find a way to make money and they might do things that are more risky because they know it might attract certain audiences, but it doesn’t mean we can legally host it. And so we haven’t had any major issues with that, thankfully. We’re pretty on top of that, but there’s all kinds of things to look out for. And so a lot of it came down to kind of having little simple systems of like, where, you know, where are you already selling? Do you have a style or an Instagram or a portfolio? And then, you know, just kind of going from there.

James Kemp:
Nice. You mentioned using the vendors plugin. I think WP Vendors is a different author, but I know there’s maybe 3 that are kind of high uh, high profile, high usage in the space.

Katie Keith:
The official one’s Product Vendors, isn’t

James Kemp:
it? The official one is that—

Mike Moloney:
that’s what we use. That is the one we use, Product Vendor, I think. Yeah, like, I’m just gonna Google to check real quick, but I’m pretty sure it’s also

James Kemp:
the one we use in the WooCommerce Marketplace.

Mike Moloney:
Yep, yep, this is the one we’re using and we’re still using to this day. That’s what I just didn’t know the name, but it’s definitely— I knew it was WooCommerce, like, official because Uh, the way that, like, from the profile and the emails we get and stuff for the receipts.

James Kemp:
But yeah, you kind of implied that, um, you were maybe running the marketplace before you had that installed, right? Did you have— was that just with like the one user, or, or at what point did you switch to using the Vendor plugin?

Mike Moloney:
I believe, yes, we had just WooCommerce with like the admin account, and then we were uploading products and kind of tracking the sales directly.

James Kemp:
So you were doing it for them?

Mike Moloney:
Yeah. And it was very— we very quickly changed. It was probably less than 10 vendors when we decided, okay, this is a viable option. And that’s kind of always been our mentality for our business is like, let’s test something. And then once we have enough data, let’s invest in it.

James Kemp:
Great to do it.

Mike Moloney:
Yeah. Yeah. I mean, we just didn’t have a lot of other options. Like I do, like in hindsight, I do wish we would have raised some money when we had some of our peak revenue months, but I was very young and I just, had no idea. Like, there’s this like idea with businesses where when you have momentum, it’s like, it’s, it feels like you’re gonna have it forever. And, but that’s not the case, especially with like digital products, with creative products, and with AI and the internet. Like, any business is on the chopping block these days. And I know like a lot of people in the, like, we’re kind of a small niche in the stock market world, like stock photo, video, etc. And I know that world is changing fast. Like Getty, they’re still surviving and doing fine, but they just filed for bankruptcy. There’s a lot of consolidation with like Shutterstock has acquired almost every marketplace, or I think Artlist is another big player and they’ve went the AI route. FreePic, which is a European company, also is huge and they went the AI route. And so like everyone’s finding their footing, but it is, it is scary because like you don’t really know what’s next. And so I think we’ve tried to lean into the human nature of the marketplace because that’s how we started. Like myself, my brother, we’re both creators. My brother’s more of like an artist in physical realm. Like he does painting and sculptures and stuff. But even over the years, he sold a lot of products on FilterGrade that are like related to Super 8 and 16mm film or paintbrush textures and other things like that. And so we, we kind of just realized like we might not be able to compete directly with some platforms that have literal AI models and video and photo generation, but we can have somewhat of a handcraft approach similar to how like Etsy competes with big sites in the sense that they’re a site for handcrafted goods, you know.

James Kemp:
I think one difference, um, in what you do is you’re kind of and maybe it’s not 100% this, but a lot of your products are targeted at the people creating the, the art, you know, the photos, the, the Photoshop stuff, whereas these, uh, other stock sites are selling like this is the final thing.

Mike Moloney:
Yeah.

James Kemp:
Uh, to, to the consumer. Um, so yeah, I mean, maybe, you know, those people aren’t, uh, aren’t looking for the final AI solution of exactly what they’re trying to make because they enjoy the process of making and creating.

Mike Moloney:
Exactly.

James Kemp:
But maybe there’s some, some world where they want to find, uh, you know, LUTs and filters for their agent to use.

Mike Moloney:
Exactly. Yeah, it’s definitely on my mind of like where things are going, and I need to understand, I would say, like the AI photo and video and creative realm more, because I, I have like a little bit of experience with like the normal chatbots, and I’ve been using them to like do research and other things. And I’ve played around with vibe coding and used like Google Anti-Gravity and Cursor and those things, but they’re not quite in the creative realm. They’re more like technical stuff, I would say.

James Kemp:
Mm-hmm.

Mike Moloney:
And I’m still so curious about creative, uh, AI agents and video models. I, I do, um, we have— I haven’t personally that much. My brother has used some AI stuff for audio, um, especially because he does a lot of documentary filmmaking. And so it can help with like literal, literally like just clearing up voices in audio recordings. And so there’s all these applications. And I think, um, I know like with even live streaming, I’m sure there’s a lot of AI stuff involved now, or like other stuff like that. And so it’s fascinating to me, and it’s just a matter of like, how do I learn it all? I gotta, you know, make time.

James Kemp:
I guess one use case and one scenario that might be quite nice, uh, is these— there’s a few apps out there, right, where you can, you can insert your photo and apply the filter. Yeah, um, there’s still not that many good apps that do that.

Mike Moloney:
Yeah.

James Kemp:
Or they’re kind of limited in, in the selection of filters that you can apply.

Mike Moloney:
Exactly. That could be huge.

James Kemp:
Yeah, that’d be quite nice.

Katie Keith:
Now you mentioned a minute ago about, um, if you run a digital product business, everyone’s on the chopping block these days. And let’s go into that in a bit more detail. Uh, so I’m going to assume that your traffic has gone down in the last 2 years because everybody has. Uh, how have you been affected by the changes to organic search, which is largely AI, AI overviews, all of that stuff, and what are you doing about it?

Mike Moloney:
Yeah, so we’ve been affected quite a bit. Um, it’s, it’s kind of unfortunate because it is hard. Like, we do rely on some of the traffic to create revenue, not just through the marketplace but through the blog. Like, one of our revenue streams that helped keep, you know, helps keep the lights on and fund all of our expenses is like advertising on our blog. And so because a lot of our content that we spent a decade or more building is getting kind of extracted and re, you know, summarized by these AI platforms. It’s— it has significantly changed that. Um, I would say the biggest thing that we’ve adapted with is more so just focusing on the marketplace and enabling the sellers to do more and to upload in different ways. We’re still like pretty novice on some of those things, but I’m trying to learn more about how to be visible to AI platforms, how to be accessible. I think there is gonna come a time when we’re gonna have to pivot to some extent to like, maybe not pivot the products, but pivot the mechanisms or the delivery of like how people discover them. I think we do have some benefits with like the sheer volume of images and products. There is a lot of discovery, you know, through sites like Pinterest or Google search and images, like, and that’s still visible because these, even ChatGPT or Claude, they need to pull from somewhere. And so like, if someone asks what’s the best film filters, like we still have a lot of catalog to support that. And one thing we’ve done over the years is focus on very niche things. Um, like what, you know, like what LUT is for this camera, let’s say like ARRI or Alexa or like really high-end film cameras. And so I think Um, we have like value in that regard, but my challenge lately has been thinking about like, where do we go from here? I mean, the marketplace has shrunk a lot, unfortunately. Yeah. And so it is a little bit of a struggle. We’re not, um, we’re not working on it to the same extent we were in, let’s say, 2017. That was like our peak year. Um, now a lot of it is people applying versus us recruit— like, we’ve fully stopped recruiting new sellers because at a certain point My brother and I were working on the business really heavily from like 2016 to 2021, 2022. And at a certain point during COVID and all these changes, we just couldn’t attract sellers anymore. And some of that came down to like, we didn’t have the same value adds that competitors like Gumroad or even like Shopify and other platforms that offer digital products now have. I think one of the reasons we scaled so quickly and we were able to attract that market share in 2017 is that things didn’t exist yet. And as things became more easy to develop, now, you know, you can sell a digital product on Linktree, which like at the time when we were selling, everyone— like one of those selling points James kind of mentioned it is like people are going to be talking about the platform. There was, there was literally people who were like kind of— we had some haters and people making fun of FilterGrade and they were like, I like, I know you’re money hungry if you have a FilterGrade link in your bio, or like, I see like all I see is filtered links in the bio. And so we benefited from that. And one of my, like, I wouldn’t say regrets, it was just like a learning experience. But one of the vendors, a few of them were like celebrity type, not celebrities, but they had management, so to speak. And so I was speaking to the, the manager of those vendors, like their agent, and he gave me really good advice. He was like, and this was pre, you know, Linktree being big, and he was like, you know, I’m seeing a lot of these creators with link in bios, like maybe you guys should explore that for FilterGrid. And in my mind I thought, oh, that’s a little extra from what we’re doing, and we didn’t have a lot of money to develop it. But I think that was probably one— that would have been one of the smartest kind of pivots, is like going from just a marketplace to being like a link in bio solution, because that really is the portal. Like if you can control or have direct access to the audience, then you can have infinite amounts of traffic and data to then monetize in different ways. And so like, even I as a creator, I have different— a different business where I share food videos. I use Linktree to this day because it’s a really simple solution for me to share a bunch of stuff at once without having to set up a new website. And so, and the reason I bring this up is now you can sell digital products on Linktree, on Beacons, like all these link in bio platforms. And so At a certain point, because of the scale too, we have to have— we have a pretty high commission. It’s 50/50 now. Originally it was 70/30, where the vendors would keep 70, we could keep 30. It just wasn’t sustainable. We were at a certain point, especially like with rising costs of all these things, we couldn’t survive. And so we had to pivot that, and it was a really hard thing for me to do. I was scared. Um, I didn’t want to take money from the vendors, so to speak. But in order to maintain the core infrastructure and give them anything at all, we needed more money to sustain the operations. And so with that, we’re trying to find other ways to benefit sellers, like investing in— we don’t do like advertising, but we invest in organic advertising, so to speak. So we’re still publishing content that drives sales to vendors. We’re still publishing YouTube videos, which cost money to produce. But that also is a direct portal. And so that’s really like to your question of like, how are we adapting? I think even though AI has shifted a lot of things, there is still a ton of value in original content, especially video. If you’ve noticed, like from our conversation just today, Instagram has pretty much become dominant by video. Twitter is, they just recently announced they’re gonna be funding creators with video. You have things like Twitch and YouTube Live and all these live streaming platforms. And so we’re still very heavily invested in video content and video output, even for our vendors. And so like, even though it might not be on an individual product basis, like we’re not promoting every single product, but our goal is to drive traffic to those categories and to optimize the discovery of products. And something I’d like to invest in soon, if we are able to get enough money from the marketplace, is improving the actual shopping experience. Like, that actually reminds me, in terms of like that, it’s not something that the vendors might recognize or that I like think to talk about as much, but one big investment we made is in plugins, which is your business, you know, to create value for our vendors. And so one was like, just like, it was like 2 years ago, we invested in, I forget the name, I’m not good at remembering these names. I haven’t been as active with it, but It’s basically an advanced checkout plugin and it’s in the same realm as the Shopify plugin or Shopify checkout where it’s much easier.

Katie Keith:
Like Flux or Checkout WC or something like that?

Mike Moloney:
I think it’s Checkout WC. That’s the one. And so it’s not like a significant investment in terms of maybe money every year, but it was a significant investment of time and energy to optimize, test. And we also have spent a lot of time making sure that file, like, product delivery works, and we had to host our products on Amazon, you know. And so all these little things that aren’t initially built into, like, the core plugins, I think it might not seem as beneficial to the vendors, but these little optimizations have helped. We have, like, Apple Pay, Google Pay, Cash App Pay. So these things drive more sales for vendors that I’m sure they could get them if they had their own Shopify store, but And I’m sure other marketplaces have, you know, tapped into that as well. But it’s like, it’s harder to build than people realize, you know. And if you’re doing it yourself, you learn those things as you go. But it was just something that we had to kind of do over the years. And it’s even like, we have a few vendors who sell— they sell Photoshop plugins. Not— we don’t have like full code, you know, like CodeCanyon type stuff, but Photoshop plugins. And so we had to get another plugin For serial numbers and delivery of those. And so it’s like, there’s all these little things that we had to invest in over time that people aren’t gonna see. And they’re probably gonna be like, oh, you raised, you know, you raised your commission, but you’re not doing anything for me. But on the backend, not to mention the incredible amount of costs associated with fraud and other things like Stripe takes pennies from every sale on top of the swipe. I think it’s 1%, actually, it’s more than pennies. And, you know, we can’t really turn that off because fraud with digital products is rampant. I’m sure you both know about that. Like, it’s way easier to, to do, unfortunately, versus physical products, and there’s a little less verification involved. And so it is a challenging business. I’m not surprised to see larger platforms, uh, selling to the big dogs because, like, at the end of the day, that’s probably the, the best, uh, possible

James Kemp:
Yeah, I think there’s a few things to touch on there. In terms of like, on the WooCommerce side, you mentioned like the visibility of products to, to AI, to agents, to things like that. That is something that we’re focusing a lot on at WooCommerce to, to kind of just make it work out of the box. Yep. And that comes in like a number of different formats. So one of the most basic is like the llms.txt file.

Mike Moloney:
Yep, I’ve heard of that.

James Kemp:
Um, it’s something that, that we will likely ship. I don’t know how useful that is currently and will be in the future. It seems like, um, you know, maybe, maybe that’s potentially how some agents use it now, but may not be in the future.

Mike Moloney:
Yeah.

James Kemp:
Um, but also like the, the product data that we put out, um, you know, onto the product pages themselves, the kind of structured product data to really present the data in an agent-readable way. You know, UCP, the actual integration with, I guess, OpenAI and other companies. Yeah. So all of this stuff is stuff that we want to be as optimized as possible out of the box. Which I think will really help to make, you know, that’s a USP for you. You know, we have this visibility that you wouldn’t get from a Linktree.

Mike Moloney:
Yeah. And that’s something that we did. It’s not quite the exact same thing, but something I wanted to do really early on was like make sure all the products on Filtered are very heavily optimized to show up in Google Merchant or Shopping. Um, Bing and those other ones. And so that’s even another example where like even that helps on both like the discoverability with shopping search engines, but also AI pulls from those same sources, you know. And so I think the more ways that we can be visible for our sellers, that’s something that I think about all the time. And it’s something that is a little more time-consuming than people like the vendors themselves might realize, but it leads— and even if someone discovers another product, it leads to theirs getting discovered. And so it’s like That’s my biggest thinking these days is I really want to utilize— like, I’ve been doing a lot of vibe coding with another website I run, but it was built from the ground up. It’s not WordPress, you know, it’s a lot easier to just ship and deploy, whereas we can’t really just mess with like Filtergrid. It’s very— there’s so many products and users that depend on it that I don’t want to just set, you know, send an agent on it. But at the same time, It would be incredible if there were— like, I want to find a way to utilize vibe coding tools so that I can ship things like LLM text faster or have it monitor the site and say, like, what’s missing. Because on that other site I’m working on, I noticed that the search traffic was a little off and I sent it a message and it literally was like, your sitemap is broken, let’s ship a fix. And it was fixed in minutes. And it’s like, How many of these things are broken with FilterGrade that we can’t as easily fix? And so my biggest goal is to do things like that. Like, even if it’s not— it’s AI in a number of ways, but AI in the sense of to identify security issues, to identify discoverability issues and automation things, and things that will speed up the process for vendors and ultimately increase their revenue.

James Kemp:
Yeah, I think it’s a really nice way to focus on it. And also, I think to kind of touch on a point that you raised earlier, you know, about Linktree and everything, I think although a vendor could sell via Linktree, the difference with that is that they already have to have the attention of that audience. Yeah. Whereas the marketplace route, you know, the they— people looking for filters find the marketplace and then have this whole plethora of, you know, vendors that they can find. So discoverability in that respect, I think, is a USP as well of the marketplace.

Mike Moloney:
Yeah. And there’s a lot of people who have made, like, really significant money. Because it’s been a decade, too. Where, like, just over those 10 years, there are people who are, like, not even on Instagram anymore because you know how those things come and go. And they’re still getting— like, I got a few messages like this year or last year and they’re like, hey, is there a way I can log in? Because originally we didn’t even have a login for the vendors. And they’re like— and we’re still paying people out all these years later. And so that makes me really happy. And I do think that’s like you said, one of the selling points. Like, Linktree is a very siloed platform. There isn’t like a Linktree marketplace. Maybe they’ll build that. But that’s not their business, you know? And so, and it’s kind of, I mean, Gumroad’s a little bit in the middle. I always loved their, their business. And I think Sahil’s a brilliant founder, but they’ve, they’ve done like a little bit of both where like you have a dedicated domain and you have a Gumroad shop, but there is discoverability. And so I always thought that was fascinating and we’re kind of like a little bit more of a hacked together version of that. They’re much more technically sophisticated, but I think like Everyone has their own benefits. And I think we’re also non-exclusive, you know, you can sell your products anywhere. And that’s something that I was proud of because even though like it would have been beneficial to lock things down, I found that we’re just, we’re trying to build a platform and a tool for enablement. We’re not trying to be this like exclusive private club or small, you know, boutique thing. And because at the end of the day, I was at one point a small creator and I didn’t want to be excluded. And I was from plenty of platforms for my stock photos or this or that. And I just don’t believe in that. I think anyone who’s talented and creative and has ideas, and, and which is literally everyone, everyone has ideas and products in their head and stuff, they should be allowed to have that route.

James Kemp:
I like that. Um, I think if we jump into a couple of questions regarding advice that you would give to people considering either starting a marketplace or, you know, maybe they have an idea for a marketplace. What do you feel like, based on your experience, that they should know before they turn perhaps an existing store into a marketplace?

Mike Moloney:
That’s a good question, and it’s something I reflect on a lot because you’re constantly kind of like building, reflecting, building, reflecting. The number one thing that I’ve learned, and it applies to all my businesses, all my— even my personal life, is like figuring out the systems and the, like, um, standard operating procedures that are— that you’re using and ways to, like, speed up your own processes. Because when you identify those and you know them well, you can build out tools that reflect that for the vendors. Um, so for example, like, understanding the process of up— like, it wasn’t until I knew how to upload my own products, and I’ve done it on Um, Shutterstock, Adobe Stock, Gumroad. I’ve used literally like— I am like obsessed with trying other platforms because I want to learn the best approach. Until you know things, you can’t really build them for other people. Not to say that you can’t, but you know what I mean? Like, you want to give them the best experience. And so how do you do that? Study all the options out there, see where you can make improvements, launch it. And then the other one big one that I’ll kind of say, um, is understanding like scale and protecting yourself. So like on the legal front, understanding things like DMCA and legality and all that. Like it is— there’s gonna be a mix. Like you’re scaling a business, not everything’s going to be fully compliant or optimized, but trying to find that balance. Talk to people who have done it before. Use AI or Google search to find answers. Like look at the government, the law. Um, it’s not worth ignoring because even if you’re a small business, they don’t care. You’ll still get penalized. And then, um, really other than that, just like finding your north stars. Like, what do you want to build for? Like, if it’s just to build so you can make more money, people are going to see through that. You’re not gonna build the best solutions. But I think if you figure out like, hey, I want to build something for other creators, or hey, I’m a painter, I want to build a platform to discover paintings and art sales, like whatever that niche is, do it for a cause or, you know, something that you really care about because it will take you further.

James Kemp:
Yeah, I think that really resonates. You know, all of the plugins that I used to make were because I had web customers that needed those things. So you’re building for a need. And I guess, you know, you can often be your ideal customer as well. Like, what— I need this marketplace of filters, for example. Yeah. So that’s really cool.

Mike Moloney:
Exactly.

Katie Keith:
Well, thank you so much, Mike, for coming on the show. Where can people find you online?

Mike Moloney:
Um, so right now I have Instagram is @mjmolo, and then my Twitter is @MaloneyMike. Um, other than that, I share some articles on Medium, not super actively. I need to get back on that, but mainly those 2 places. And then if you want to see my work, it’s, you know, filtergrade.com is basically one of my life’s projects. And so that would be the best place.

James Kemp:
Awesome. Thanks, Mike. In our next episode on the 24th of November, we will be joined by Daniel Bassana from WPOK. And we’ll be talking about maintaining a WooCommerce store.

Katie Keith:
Yeah. And if you don’t already, please subscribe to Do the Woo. You can see all the different places you can subscribe at dothewoo.com. woo.com because we’re on YouTube and all the various podcast platforms. So, um, do that and then you won’t miss future episodes. Thanks for watching. Bye.

James Kemp:
See ya.

Mike Moloney:
Thanks. Bye.