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Gumroad Gets $1.1 Million To Turn Any Link Into A Payment System (techcrunch.com)
153 points by noahyeh on Feb 8, 2012 | hide | past | favorite | 55 comments



It all started here on Hacker News: http://news.ycombinator.com/item?id=2406614

So... thanks! :)


Congratulations! I remember it very well when I saw your post on HN. At that time I thought this is such a simple problem and simple solution that is ... hmm... bound to be successful! Just like pen.io which was just as simple, but if you think about it, why does it have to be difficult? I'll sure look forward to using your service.


Congratulations! Amazing job securing funding.


Great job! I remember when you released it. Out of the many things that have been released on HN, Gumroad certainly stands out in my mind as one of the most unique and well executed so far.

Keep up the good work.


It is always a good day when someone simplifies something, Gumroad is a great example of this. Congratulations and I hope Gumroad becomes wildly successful.


Congrates Sahil!! Couldn't be happier for you. Guess your decision to do your own thing turns out to be a right one? :)


Amazing. I had no doubts you would go places with Gumroad, but I didn't imagine it would happen quite so fast!


Big congrats Sahil!


Congrats! Giving the power to the creator. love it


Congratulation Sahil, best of luck.


Kudos Sahil!


I'm confused. Once some one buys the link do they get the real url? Could this person share this real url on Facebook?

I understand that with a traditional online store, a customer could upload the downloaded file as a torrent and share it on Facebook, however, the ease of sharing a link compared to creating a torrent is pretty large.

I guess the idea is to use this for content that you never really expected to make much money from, so if it is shared you are okay with that.

I almost feel like the service should have a pay what you want option. Some people may use the stolen free link if the only pay option is $10 but would be willing to pay $5 if it was an option.


I think Sahil addressed this elsewhere before, but my own assumption is that if someone is willing to hand over money for something they understand that creators deserve to be paid for their work and they won't then go ahead and distribute it at no cost. The latter shouldn't be a concern anyway, even if the link was unsharable someone could still download and re-upload elsewhere.

The technical solution I assume (which actually goes against what appears to be the idea of Gumroad -- simple for everyone) would be a Paypal IPN type system.

You can upload directly to Gumroad and that has no issue of unauthorised sharing, but if you use the pay wall for a link type then you do risk it.


Gumroad could proxy the download (what else would people be selling?) but I suppose that implies large bandwidth costs.


They already offer that option (to upload directly to them) it's an option alongside using a link. Even if someone uses the upload link the problem of buying -> downloading -> uploading elsewhere exists, just like it exists on itunes and any other service, so really it's a none issue...


i'm assuming that the link either expires after a set period of time, or is set to become inactive after so many hits overall or within a defined period of time.

either way, i'm curious as to how he handles it.


Two suggestions:

(1) Provide a trial mode where I can sell stuff (like real) for $0, so I can validate the whole experience.

(2) Provide an API where I can create new sellable objects dynamically and programmatically.


I'm creating a fake account right now for test purposes and apparently you can sell stuff for $0. You can easily test it without actually doing anything "real".

As a seller my only issue is the sales link has a Gumroad logo that is kind of big and would be better listed as "powered by Gumroad" instead of just Gumroad as not to confuse users, but I have a feeling that will be a premium feature :)

The rest of the product is extremely simple to use.


I'll be honest here. I worked on the same exact idea and ended up abandoning it when i discovered your app on techcrunch a few months back. Couldn't have done it better! Great job! I'm glad it's moving forward! My only question is how do you plan to deal with potential copyright infringements. This almost seems inevitable to me.


I emailed that question and a few others (ie- handling disconnections). Shall update when I get a reply (if not already). :)


The reply. Not exactly the answers I expected...

[Q: How do you stop a download link from being shared?] A: We don't. We bet on the god will of mankind.

[Q: Are links screened for copyrights, fakes, etc?] A: No. Gumroad isn't a marketplace so we don't need to do this as much as others do.

[Q: How are disconnected downloads handled?] A: Working on improving this. We do OK.


It's pretty scary considering what just happened to Megaupload. I suppose one could implement some sort of community-driven screening process for sellers.

Thanks for posting this!


I am happy for sahillavingia that he get the investment, however isn't it little bit funny that in the techcrunch article most of the time they tell how good his designer skills are :) ? (no doubt, they are)

I see this not for the first time, that a really simple and straight forward project get much attention just because of nice design. Such kind of projects is easly copycated, don't they? So, that means that whenever you have a nice idea but your design skills sucks, then don't publish it before you haven't polished it, otherwise it will be copycated with much nicer look'n'feel and you sucked. Is this is not a contradiction on its own (that we were told to publish as eary as possible) ?


Awesome idea. Not only does it open new markets that were previously too difficult to monetise, but also give sellers finer control over what they sell. eg. Users can buy one broker report without having to sign up with the stockbroker, read one article without having to sign up for a whole subscription.

Not sure this is in the works or not: affiliate codes will absolutely rock on this platform.


When you first announced gumroad I had already built something similar, can I ask if you looked for investment or they came to you?

My system allows the users to use their own stripe account keys, so we dont take a % or 30c.


http://semilshah.wordpress.com/2012/02/08/tomorrow-is-a-big-...

> He asked for some help around meeting investors. I was very happy to do this. I sent a few intro emails that were really short — “hey, you gotta meet this kid, kick ass front end engineer and designer with a lot of ambition, ready to go out on his own.” My emails were returned within hours, and in a few weeks, he had his pick of some of the best early-stage and VC investors in the area.


Is this something that is publicly online yet?



FYI your Facebook login doesn't work, displays Facebook error message when clicking it and also Twitter login redirects back to homepage, on the second click it logs me in.


FB Fixed - thanks for bringing it to my attention. Looking into Twitter now


The original "Show HN" submission: http://news.ycombinator.com/item?id=2406614

Nice job turning a weekend project into $1.1m in investments! It seems like the payments industry will support new approaches into perpetuity.


Wow. I remember when this first got started on HN a while back. It's amazing to see where you guys are now.

Congratulations Sahil!


Sahil is very sharp and a great designer. What's more amazing is how well he understands the underlying gears that drive Silicon Valley. Congrats and expecting big things.


I love how Sahil learnt all the stuff he built into Gumroad along the way, through other projects. Beautiful design: Dayta, Pinterest and turntable.fm. Short links & payments: Crate. He started small, kept on learning and now the product looks amazing. Congratulations and all the best!


From the article:

'Gumroad monetizes by taking a 5% cut and 30 cents out of every transaction'

From the HN launch thread:

'I think something like "5%, but at least $0.30" would make more sense'

Good on ya for listening to your potential users :)


Hey you should get someone like Louis CK to use this to sell his next show. Win-Win for all!


How did you manage to automate transferring money to peoples bank accounts all over the world? I'm very interested in how you managed to solve this.


As an European, I seem to have a different stance on the morality of customers.

So your first user buys the link. Say to a mp3 or a pdf. Now has the link in plain text.

What's stopping the user from posting that very link all over twitter, facebook, etc? "omg check out kanye's new single!1!!"

Seriously at a loss on how this will work in real life, with real customers.


There is nothing stopping user from posting the file on megaupload (oops) another file sharing service as well.

Any protection, including DRM, link obfuscation or IP filtering, makes user's life harder. If they want to post it, they will post it. But once you started the war with a customer by putting those little obstacles in their way, you can't stop it.

Imagine a different scenario, where it's easy not to pay but you only have to deal with your conscience.

Imagine _why posting a new chapter of the Poignant Guide. Randall Munroe releasing a charity comic. Stephey Fry kickstarting a funny ebook (http://unbound.co.uk/books/how-to-have-an-almost-perfect-mar...). Radiohead releasing a new album.

There are million cases when you can pirate easily but it's more fun to pay. Because you respect the artist or want to support the cause. I guess this is exactly the use case for Gumroad that I see.


i understand your ethical argument, but i still fail to see the practical usefulness.

easy beats free. piracy/copyright infringement means free.

you want to get people pay for something - you can't do this by optimizing the payment method. who really gives a crap about that outside of the techies who build that stuff?

example: first one to make tv episodes globally simultaneously available, with local ads embedded or whatever will win over piracy. just look at the most popular torrents on pirate bay, etc - how i met your mother, etc.

itunes (as an example, same goes for netflix, hulu, amazon,...) is broken in that regards. non-us credit card and/or IP address? you're fucked. welcome to being a third-rate customer. well, fuck you then, pirate bay it is. movies, series, even apps are being restricted. even though the fucking majority of people (consumer!!) live outside the US.


What are you going to spend the money on?


Congratulations! I'm looking forward to seeing how this turns out. Well done sir :)


Hi, Sahil, I'm getting a small glitch in the right-hand side menu on the FAQ page:

http://imgur.com/kjh5n

That's in Firefox 10 on Ubuntu 11.04


Wow...nice work Sahil! Looking forward to seeing more great stuff from you. We should plan another Saturday brunch.


Why won't existing URL-shortener companies now add an option for a toll? They already have name exposure.


Aaand I think we (and techcrunch coverage) just killed your site, hehe. Really slow right now.


Is it just me having a hard time reaching the site?


5% cut? No way. Dwolla https://www.dwolla.com/ takes $0.25 per transaction and NOTHING for amounts less than $10.00


Dwolla doesn't let you take credit cards. People buy things online with credit cards.

It's also inappropriate for the flow this app wants. You click a link, enter your CC#, get your content. Takes 5 seconds.

With Dwolla: click a link, sent to Dwolla, create a username, password and PIN, add an address, wait to receive a phone call or SMS, click a link in a verification mail, add your bank account, wait 2-3 days to verify your bank account, go back to the site and finish your payment...


You only need to that the first time. Once you have it set up it's just as fast and way cheaper for both merchants and buyers. There are plenty of payment services that take a percentage cut, Dwolla is the only one that doesn't.


That's not true. There are lots of flat rate ACH payment processing companies, just like Dwolla. Your utility companies probably use them, for example. Almost any company that lets you pay your bill by providing your bank account details is using one.

Being paid by ACH through PayPal is free and has been free for the past 13 years. PayPal only charges once you upgrade to a Premiere or Businesss account, which is what allows an account to accept credit card payments. It also lets you pay someone having to deposit money in advance like Dwolla -- PayPal calls these payments eChecks. The merchant is notified immediately about the payment then again when the transfer clears.


Why is GumRoad getting more buzz than http://www.kout.me/? They seem to be very similar products.

Is Sahil very well networked?


Kout doesn't really seem to be launched (you can only sign up for list). Whereas Gumroad lets you sign-up right now.

Gumroad's design is also a bit more inviting.

I hadn't heard of either of them until today, but one is definitely in a place where I would share the link with buddies, and the other I wouldn't.

You ask about "buzz" and I definitely think launching a working product is more newsworthy than a beta sign-up page. That said, Kout seems interesting as an idea.


no he is not well networked. I mean, who ever heard about Pinterest or Turntable?


most importantly, Sahil went to Singapore American School.




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