At the end of 2020 I interviewed A developer launches a Shopify app that sends manual text messages to cart abandoners. 18 months later we spoke againthis time we’re going to talk about selling that company and buying another company, an app to create upsells in Shopify Checkout.
By early 2023, he had sold his second company and I started the third onea coupon leak recovery app.
This begins our fourth conversation with Dennis Hegstad. He shut down his coupon leaking business and launched a data provider for the e-commerce industry called 4th Internet Research Unit. What exactly is the Internet Research Unit? I asked him that question and more when we spoke recently.
The entire audio of our conversation is embedded below. The transcript has been edited for clarity and length.
Eric Bandholz: Please keep us up to date on what’s going on in your world.
Dennis Hegstad: In 2021, we sold LiveRecover, an SMS app for Shopify. That was our first outlet in e-commerce. He then bought another app, OrderBump, in 2022 and sold it just 100 days later. This sale was pretty lucky.
In 2023, he launched a coupon code leak prevention app, Vigilance, but that business failed. Shopify updated their checkout system and ultimately shut down Vigilance due to an outage. We offered to give our investors their money back, but they said, “Try something else.” So we started building the Internet Research Unit earlier this year. The same Vigilance investors are also in it.
Bandholz: What is Internet Research Unit?
Hegstad: A data platform for the e-commerce industry. Our primary users are brand owners, agencies, app developers, and financiers. Brands can track competitors’ revenue, sales numbers, popular SKUs, app stacks, and more. Set alerts to track changes in competitor sales and app usage to guide product launches and strategic decisions. Agencies and app developers can use this data for lead generation, tracking which brands are using a particular service or technology like Klaviyo and which aren’t. . Investors can assess trends and identify distressed companies they may want to invest in or acquire.
Our product is a high-end product that costs about $500 per month, so it’s not for beginners. Intended for existing companies who want to fine-tune their strategy.
Our data is public. Brands can’t hide it from our platform. Compliance-related issues such as price manipulation and accessibility compliance can be tracked, allowing companies to address potential issues before they lead to litigation.
We have a way to accurately estimate sales and break them down by SKU. For example, if your brand sells leggings, you can report on which colors and sizes are selling best. This allows competitors to focus on high-performance products.
Bandholz: The front-end design of the software apps, including Internet Research Unit, is great. What is your design philosophy?
Hegstad: We do not use professional designers for our site. My co-founder and I are in charge of design and prioritize aesthetics. Stripe pioneered the trend of beautifully designed SaaS platforms, and we’re following that approach. Software should feel fun to use, not boring or outdated.
We’re going for a cyberpunk vibe with the Internet Research Unit. This is something that will appeal to futuristic and tech-savvy users. We have also started selling small products such as shirts and hats with designs inspired by this aesthetic. We hired a designer to create cyberpunk-inspired shirt art. The reason people call me “anti-algorithm” is because it feels like everyone these days is controlled by algorithms. It’s a fun way to rebel against it.
We also looked at other branded products, such as ZYN style (nicotine pouch) cans that come with a USB drive. But before we delve deeper into products, we are focused on growing the software business. If the software performs well, they may reinvest some of the profits back into the brand.
Bandholz: Is the platform fully built?
Hegstad: It’s still going on. The service launched in March and has been gradually accepting users. It is scheduled to be opened to the public in November. We would like to add funding data to help users find brands that have raised funding but are underperforming. This will help venture capitalists and mergers and acquisitions teams identify distressed companies that need support.
We’re not shooting for the stars. We want to create something fun and keep doing it. It would be great to reach $5 million in annual revenue. we love this business. It’s challenging and there’s a lot to learn.
Bandholz: Where can people support you?
Hegstad: our website is InternetResearchUnit.com. You can also find me at linkedin and ×.
