I don't get entirley what he did to validate his idea for AppSumo. He got 200 new customers for imgur which pay 25$/year (to imgur) and he payed imgur 3$/user for this? Didn't he loose money then?
The sales pitch is probably what threw you off. "I'll pay you to bring you new customers" is the pitch, but the detail is likely more along the lines of Groupon's deals: "I'll charge $12 for selling your $25 product, and keep $3 for myself. So I'll pay you $9 for every new customer I bring."
Assuming it's the kind of business that typically sees recurring revenue and the expenses of servicing each new customer consists of little more than pushing electrons around, $9 for a new customer isn't too bad compared to whatever their current cost per acquisition is.
Assuming it's the kind of business that typically sees recurring revenue and the expenses of servicing each new customer consists of little more than pushing electrons around, $9 for a new customer isn't too bad compared to whatever their current cost per acquisition is.