Andrew: Hey, there freedom fighters. My name is Andrew Warner. I’m the founder of “Mixergy” where I do a series of interviews for real entrepreneurs. And you know they’re real entrepreneurs because so many people who listen to my interviews will then come back years later and say, “Man, I listened to your interviews. I was always wanted to be on and now I’m on.” And then they come on and tell their stories. So because of that I want to get at the heart of the story, and the kinds of things that would bore people who aren’t entrepreneurs who just want to hear about getting the Lamborghini, I guess, seems to be the big one. I don’t know how Lamborghini made a comeback, but maybe it’s get-rich-quick bloggers have made a comeback.
So the type of thing that would get those people excited is not what you’re going to find here. You’re going to find the type of stuff that only will get real entrepreneurs excited and then the rest of the world will be bored because we’re getting into the nitty gritty of business and entrepreneurship. And today’s guest is actually someone who . . . I don’t know how many times I saw this in my research of him. He has said, “I have no attachment to money.” And still, when I look at his revenue online, he’s doing tens of millions of dollars in revenue, and he did it by bootstrapping his company.
So how does a guy who says he has no attachment to money make so much money? I invited him on to find out about how he did it. His name is Robert Gryn. He is the founder of Codewise, which specializes in advertising technology. They have two big software brands. The first is called Voluum. It’s an ad performance tracker. And the second is called Zeropark. It’s an ad buying network.
I think I saw you look at me a little funny, Robert, when I said founder. You’re not exactly the founder. You’re the founder of a company that basically took over Codewise. I want to find out what happened to the real founders, and how they feel about you being here as the guy representing the company and leading it without them. And I’m going to find out how he built up this business and I almost feel like almost rip you apart physically.
Thanks to two great sponsors. The first will help you guys out there send your next great smart email marketing campaign, it’s called ActiveCampaign. And the second will help you hire a phenomenal developer. It’s called Toptal. But first, Robert, welcome.
Robert: Thank you, thank you very much for having me.
Andrew: Revenue, how much are you producing? Last year, let’s say, 2017, what was the annual?
Robert: Just shy of 50 million.
Andrew: Just shy of 50 million. And profits, how much?
Robert: Actually, it would surprise you. I’m going to have to tell you that I don’t know.
Andrew: Are we talking about over $5 million in profit?
Robert: Yes, last year, yeah, yeah. The year before was our best year by far because we’ve aggressively been growing our costs have gone up significantly.
Andrew: Where are you spending so much money?
Robert: Mostly recruitment. We’ve gone from a hundred to almost 200 people in just over a year.
Andrew: How do you not know how much profit you make, more or less? I understand down to the dollar you wouldn’t. But how do you not know it?
Robert: I think it’s an interesting question. It, kind of ties into what you said earlier that I’m just emotionally not sort of tied to the money, to the revenue. I used to be a hardcore computer gamer most of my life, so I, kind of, look at the finances as just sort of a high score. And the first thing I do . . .
Andrew: I know my score in Super Mario Brothers, or whatever it is that I play. You don’t know yet . . . go ahead.
Robert: You know, I just don’t like to fixate on profits and revenues. I like to let the people who manage that well focus on that. I’m a product builder. I just focus on building something that I want to use as an end user. So the finances . . . I honestly, I get a once a month sort of very high level summary of what’s going on. And if it’s all good, I just archive it. So that’s kind of my . . .
Andrew: You know, and speaking of the product, so I spent so much time yesterday. I got lost in your world, and I ended up watching this webinar that you guys did two years ago, where the woman on the webinar said, “Here’s how we work at Voluum. Say somebody types in speedtest.com, instead of speedtest.net. We reroute that traffic because it’s one of our clients, we reroute that traffic to maybe you, one of our sponsors. If you want to buy it, here’s how it works. Here’s how you go in to buy that traffic.” And I thought, “This misspelling is an issue.” And then I saw the other thing she said, “say you go to a website, and there’s a pop up that basically takes over your screen. That’s called a pop over. We sell that too, if you as a marketer want to reach that, we could do it.” And she even used the word adware. So you guys are helping people with typos, and helping people who have adware. What gives?
Robert: So that would be the Zeropark side.
Andrew: You know what? You’re right. I’ve got it on my screen here and I misread it. Yes, it is Zeropark.
Robert: No problem. So, yes. Zeropark initially, to kind of give you a context, it was based on the startup that I worked at my first job, my only job, actually in a Czech Republic called Elephant Traffic. It was created by one of the biggest domainers in the world. He had a portfolio of over 1 million, most of which were misspellings. The one was a Facebook with 1-0. And the way domainers used to monetize these misspellings, is they would actually funnel, redirect that traffic to a Google feed, which would have, you know, mildly, sort of, related ads. You probably seen literally just a line items of ads.
And then Google kept taken a bigger and bigger chunk of the rev share, and then this gentleman his name is Jan Barta, he was like, “There must be a better way to monetize this traffic.” And so, we built a system where he sold those redirects directly to advertisers, you know, the example we like to give is flight.com which I think is still undeveloped, selling that for like one, two dollars to Expedia per redirect, things like that.
So that’s where that originated from. That experience gave me the courage to start up my first company which is Zeropark . . . actually my second one. My first one failed miserably. And so, we built the technology to serve these ads and to connect domain owners with advertisers, and then we later expanded it to pop traffic, some of which is generated by legitimate, what they call adware, when you install like a free software, you forget to uncheck something and you get a plugin in your browser. So we built the infrastructure to, sort of, integrate all these supply partners with advertisers. We don’t own any of the publishers, the websites or the adware itself, or we just, kind of, created this technology that scales very well, and is complementary with other product Voluum.
Andrew: I see. So you’re working at Elephant Tracker, which is such a hard thing to Google, because every time I do Elephant Tracker, all I come up with is the Go Daddy guy. Sorry.
Robert: It’s called Elephant Traffic.
Andrew: Oh, I see. Elephant Traffic. That’s why I couldn’t find it as I was . . .
Robert: [crosstalk 00:06:51] much about it, but . . .
Andrew: You know what? I like that you keep correcting me here. It bothers me when stuff goes out that’s wrong. I want to get it right, and for some reason I’ve got two typos in my conversation already. All right. So, you were there? Is that the place where you were an intern, and then basically by the time you left you’re running the place as COO, right? Within 18 months?
Robert: Essentially, yeah. And my fingers dipped in everything, the finances, you know, managing IT, product development, graphic design. I have a bit of background in Photoshop, so I was just doing everything, and, kind of, realized, “Hey, I’m, kind of, running the show here. Maybe I can do this on my own.” And I considered it my MBA of, kind of, what not to do. So I learned on someone else’s cause.
Andrew: Is this wesaved.pl?
Robert: So that was the first, sort of, startup I started shortly after I quit Elephant Traffic. Invested a lot of my own money in that, and then ended up selling the domain for a $1,000.
Andrew: How much did you invest of your money in it?
Robert: Around $50,000.
Andrew: I’m wondering why. So I’m looking at old screenshots of it, old archives of it. It seems like the standard type of get a massage for 74% off type of Groupon deal site. Why didn’t it work? Those things were taking off at the time.
Robert: It was a clone on the U.S. site called the Yipit, which I believe still exists.
Andrew: Yeah. Yipit was going to take all these different Groupon clones and give you the best of those deals, and then make an affiliate commission, yeah.
Robert: Precisely. So that we kind of clone that model there was around 50 Groupon clones in Poland. We built like a whole pay-per click engine in the background where advertisers could sign up and pay us to get ranked higher. But they weren’t interested. They’re like, “Why would we pay you guys when we can get the client ourselves?” The kind of approach to affiliate marketing I think it’s a little backwards still on this part of the world, in Poland, specifically.
Andrew: I kept reading these articles about how you were huge in the affiliate space, made hundreds of thousands of dollars a month. What did you do? What kind of affiliate programs? And how did you make money from them?
Robert: Sure. I did what I basically called media arbitrage. I would buy media at one source, and then resell it at a premium to another. I exploited certain things that I prefer not to talk about. It’s actually a very simple trick. The way my campaigns ran back then was on the Right Media, it was a Yahoo company. They would have automated sort of buying based on the payouts that you gave them, these media buyers. And they would always pushed for higher payouts.
So at one point I was like, what if I can just throttle the conversions that I actually fire back to them and give them whatever payout they want, because they’re still fixated on these CPA, these calls for action. So I built in this little tool into my early version of what is now a Voluum, where I would just throttle down how many conversions I fired back to them and just give them whatever payout they wanted. That was my secret sauce. I was promoting offers, like sweepstakes offers, email submits, lead generation type of stuff. It was pretty basic.
Andrew: All that stuff. And then, at the time I remember a lot of the guys who were doing that affiliate space would always say, “We’re promoting Netflix.” Imagine somebody needs . . . Netflix is paying this much per subscriber. And they always use that example. But in reality, it was a sweepstake stuff. It was stuff that what was the universities were really big at the time, right? Online universities.
Robert: Yeah, that was big, yeah.
Andrew: What’s the part that you did that you don’t feel comfortable mentioning now? Go deep.
Robert: It’s not about the comfort. It’s just that people think I was some sort of expert, but I really just kind of, I just figured out how to automate it and how to, kind of, abuse this approach that these media buyers had where they were fixated on the CPA and not looking at the actual performance. They’d come to me and say, “Hey, advertiser B has a $10 higher pay.” I’ll be like, “Here’s $20.” And that I would do it. And I did that for three years. At one point I did I think $600,000 a month.
Robert: 20%, 30% profit margin.
Andrew: Wow. All right. Before we get into the business that you built off that profit, because you did funnel into your business, did you buy anything fun? Did you forget about like the Lamborghini type stuff? Did you get anything that you especially were attracted to?
Robert: No, not for the longest time, you know. I drove my mom’s car that I borrowed six years ago, tiny little BMW. I drove that for six years even though I could afford a Lamborghini at the age of 24. I guess I got to a point where I could afford these things, and I stopped, kind of, wanting them. It continues to this day. I don’t feel the need to have any really fancy things. Although . . .
Andrew: It’s just [crosstalk 00:11:35]
Robert: Although I do have a nice car back in Poland. I treat them more as an experience, more as a sort of thrill than just an object to show off.
Andrew: Okay. What’s the car?
Robert: Mercedes GTS.
Andrew: Okay. I don’t know enough about cars to know what that is. I’ll look that up. So one thing that I heard about you is that you as a kid were constantly looking to make money. Today you can put that aside and you can archive the numbers pretty fast. But when you were a kid, you were so into it that you got into gambling for a little bit. What kind of gambling? And how did that go for you?
Robert: I guess the first form of gambling, which people might not call gambling was trading on Forex. I convinced my dad that I found this crazy new way that I can make a lot of money quickly.
Andrew: Forex is foreign exchange. What was your way?
Robert: Well, it was just around the time where the online platforms were coming out, and they’d give you the crazy leverage of like, you know 100 to 1, and I’d start playing with a demo account, and I was like, “Oh, man. This could be it. “I convinced my dad to give me 2,000 euros, and later, many years later he told me he knew I would lose that right away. He’s like, maybe he’ll learn a lesson. So that was, I think, my first sort of dabbling in online gambling.
Andrew: But if they give you 100 to 1, you’re basically able to lose 200,000, actually they wouldn’t let you lose it 200, 000, they’d for more than the 200,000.
Robert: Yeah. You can go into debt, yeah.
Andrew: And did you go into debt?
Robert: I don’t think so. I think I just lost it. Yeah, I just lost it for good. And then afterwards, that was around the time I was 17-years-old, and that’s around the time that online poker started getting popular PokerStars. I was at university, I was 17 years old. Sitting in my dormitory, I had a, you know . . . before that, I had a dial-up connection back at home. Here I had like a DSL connection. So, you know, I started playing poker with the money, and then I got to use to pay my accommodation and for my tuition. I ended up losing all of that. And after like I got to the point where I broke down, you know, I was having sweats at night, it was like the full-on addiction. I had to tell my parents what happened, and it ended happening again, and then again. And at third time I learned my lesson.
Andrew: You kept losing it. Why do you think you were willing to go into debt? What were you trying to get that you’d be willing to put up with those tough nights with the pain in your stomach and everything else?
Robert: I guess it was the solution that, you know, there is a chance to make it big in that world.
Andrew: Why? why did you want to make it big?
Robert: Because I think I was so lost in my life that I saw no other way forward. And I was looking for shortcuts as well.
Andrew: Lost how?
Robert: Just, you know, kind of a typical teenager, adolescent not really knowing his place in the world, having been a complete introvert most of my life. I would spend most weekends playing video games in my room locked up. No social skills, and this gave me the opportunity to be one on one with my computer screen having that illusion that I could potentially win some money that would then somehow maybe catalyze some other things in my life.
Andrew: Other things meaning?
Robert: I don’t think I ever thought far.
Andrew: You didn’t think, “If I make money, then people would really want to get to know me. If I make money, then I can date more.” Was that it?
Robert: Probably yeah. That definitely was in the back of my mind. You’re absolutely right.
Andrew: Were you dating much as a kid?
Andrew: No. Is it inappropriate to ask you if you lost your virginity after you were 20 after all this?
Robert: It was before I was 20.
Andrew: It was before?
Robert: Yeah. I had like a puppy love type of girlfriend in high school that, yeah.
Andrew: And you were self-confident enough to let yourself be in love? You didn’t think this is not going to last. This is not the right person. I’m not the right person?
Robert: My self-confidence I would say was high, self-esteem was very low. Something I learned that’s very different many years later.
Andrew: Why? How was that actually? That’s an interesting distinction. Confidence is high, self-esteem is low.
Robert: So I like to think of confidence as your belief in your own, sort of, skills and doing things. And self-esteem is the way you look at yourself, your, sort of, self-love. I never really had self-love until not too long ago. I kind of learned to look at myself differently. Very important transition in my life.
Andrew: Because you went through this big low that will get you in a bit, and then you have you had to find yourself beyond work.
Robert: I had to find myself or just, yeah, perish.
Andrew: Okay. How are you feeling about talking about all this stuff?
Robert: Good, good. I guess it’s not really what I expected, but I’m actually . . .
Andrew: I’m checking you out. I’m glad we do video. I’m checking you out and I could see that I’m making you a little uncomfortable, but not so much that you want to run away and end this interview. But I want you to feel comfortable to tell me, just like you corrected me when I had the wrong company name and product name.
Andrew: So then after this coupon thing didn’t work out, you’re still making money as an affiliate, you say, “I’m going to get into business for myself. I’ve got something that makes more sense. I’m going to do something that is more similar to what I was doing before, similar to Elephant Traffic, and that is Zeropark. Zeropark meaning, we’re going to help people park domains, and zero meaning zero time on their domain spent by the [crosstalk 00:16:51]
Robert:No parking, yeah.
Andrew:That’s what it was. And the first version meant that did you buy your own domain? Or did you go out and get them?
Robert: So, no. I never really was a domainer. I found it too cumbersome and sort, of the work involved in building portfolios a bit too monotonous. So the way I came to building Zeropark was, there was a conference that was actually in Poland Warsaw where I was living at the time, and it was the biggest domain conference, one of the biggest domain conferences in Europe. And I saw that there’s an opportunity to sponsor it, and I didn’t have . . . all I had was an idea for Zeropark. I thought of the name, I didn’t even have a logo, I didn’t have a platform. This conference was in three months. And so, I went ahead and I sponsored it with money from my affiliate marketing activities. And I went to the guys at Codewise. At that point, we hadn’t even exchanged any shares. They had built the WeSave, the group buying aggregator that we shut down shortly after.
And I pitched them this idea of Zeropark, and then we had two and a half months to execute. They were like, “That’s impossible.” And I’m like, “Just give me something I could demo with at this conference.” So I went for the gold sponsorship.
Andrew: Why is it so hard to build something like that? It feels like a just a fancy redirect.
Robert: You know, the interface to make it kind of visually appealing, there are some intricacies to make it the redirect fast enough and things like that. And, you know, it wasn’t just to redirect, it was actually a portal for domainers to sign up, and then a portal for advertisers to sign up. So there’s a kind of two-ended thing right there going on. But we ended up building around 10 weeks something that, kind of, worked that I was able to demo at this show, and we ended up signing up some of the biggest domainers in Poland and a few in Europe. So that was critical. And, that kind of made me realize that I always thought in these categories that you need years to execute, but if you set yourself a deadline, like I coined this term conference-driven development, where I sponsor this crazy expensive conference relatively at whatever point in time.
And then I have no other choice, but to get shit done in time for it. And we continued to apply this for actually five years. And I think that’s the only reason we became one of the fastest growing companies in Europe. But, I digress right now.
Andrew: No. I think it’s a preview of what’s coming up. This was what year roughly?
Robert: This was 2011.
Andrew: Two thousand and eleven. Was the company name called Codewise?
Robert: Well, Codewise had built WeSave, and had built Zeropark, and at that point I was just a client.
Andrew: They were a dev shop.
Robert: They were dev shop. Before I approached them, they were building a bit of software for some company to manage their three private jets. So they were just taking whatever work in their way.
Andrew:The reason I’m asking is because, I’ve been hunting back in time to see what codewise.com used to look like. And it was basically just a parked site on Go Daddy’s hosting service without [crosstalk 00:20:00]
Robert: Oh, you would have to check Codewise PL.
Andrew: Codewise PL. That’s the answer. Okay, I see. All right. And so, they were just building this for you, and then you ended up running the company, and we’re going to get to how you did it in a moment. But first, I’ve got to say to everyone, do you know much about ActiveCampaign?
Robert: Is that to me?
Andrew: Yeah, you. Sorry. I should’ve actually said . . . First, let me ask you, Robert and then I got to tell everyone about ActiveCampaign. Do you know about ActiveCampaign?
Robert: I don’t know.
Andrew: You don’t. Okay, great. I’m going to blow your mind. So here’s the deal. You know that marketers when it comes to websites are pretty smart. When it comes to email, there’s so much that they could do. Basically, if somebody clicks on the same type of message over and over again, you as a marketer should know start sending them more messages like that.
Like, imagine, all right, you send out an email, and you’re talking a little bit about domainers, and you’re talking a little bit about advertisers. If you see that someone is clicking on the advertiser links all the time and not the domainers, you might want to shift them towards a sequence of messages that’s just aimed at advertisers to teach them how advertisers can use your platform better. Well, that’s what ActiveCampaign does. And over the years, there have been tons of software that do this, but ActiveCampaign said they’re too tough and they’re too expensive. And we’re going to get good at ActiveCampaign said is, making it easy and bring down the price.
And so, they did that. And then they said, you know what? Why should it only be based on what people are clicking in an email? If they’re going over to Robert’s site, chances are they’re probably clicking over to one section of the site more than another. Maybe they’re even watching videos all the way through that have to do with advertising versus domaining. Why don’t we use that intelligence to improve our marketing also, and let’s also make that super simple so anyone can use it? And so, that’s what they did. That’s what make the ActiveCampaign so good. They are really growing fast. They’ve been around forever, but now that they’ve discovered this, it’s like they got their mojo. They’re growing fast.
Anyone who’s listening to me who has not tried this type of marketing automation has got to go and try it. And, in fact, they’re going to let you try it for free, 100% free. All you have to do is go to ActiveCampaign.com/mixergy. When you go to that URL, you’re going to see that they’re going to give you your second month free. So if you decide to sign up, they’ll even give you your second month for free. Once you do that, they’re also going to give you two free one on ones with their professional consultants to help you understand how to do marketing automation right, so that you go through, you learn with one of them, then you go apply what you’ve learned, and then you come back again to make sure that you’ve done it right and adjust based on what’s worked and what hasn’t.
And finally, if you’re with a different email provider, they’ll migrate you for free. All you have to do is go to ActiveCampaign. Com/mixergy. ActiveCampaign.com/mixergy.
All right. Robert, at Zeropark, how did you get your first customers? How did you convince those domainers to work with you?
Robert: I had to present things in quite a cultural, colorful manner. It’s very similar to my experience with hiring our first developers where we’re trying to poach them from the existing established companies and, kind of, tricking them into believing that we are worth taking the risk on. That was it, really.
Andrew: How did you do that? How did you convince them? What was it? I know being a gold sponsor must have carried weight, but what else was it?
Robert: Promising, I actually promised them specific terms on the monetizations. So I told them I’d give them a lift on whatever they’re making on their existing monetization solution.
Andrew: I see. And how could you know that you could deliver that?
Robert: I didn’t.
Andrew: You didn’t? You just said, “You know what? Bottom line, if I need to, I’ll take money out of my own pocket.
Robert: We lost some money on some of them, but I had to do it.
Andrew: You know what? I’m looking on Warrior Forum. It looks like people started talking about you pretty fast. Did you start going into those communities and promoting yourself? Was this active?
Robert: Warrior Forum wasn’t really one of the forums that we were active on. There’s one called Stack That Money, which is more of a private, sort of, affiliate marketing forum. I honestly believed that forum alone is responsible for both the success of Zeropark and Voluum. Because some of the biggest affiliates in the world are active there, and I had built quite a bit of reputation there, and that kind of catalyzed our . . .
Andrew: What did you do? How did you build a reputation there?
Robert: I shared a lot of information on how I grew my campaigns. I remember that one of my first, kind of, bigger posts was how I made my first million dollars. And I just, kind of, outlined what I did there. And people from that community gravitate towards that.
Andrew: You know what? I remember Stack that Money coming up in earlier interviews, or earlier conversations with my guests. I don’t see it much. It’s still active though. Isn’t it?
Robert:I would say, it’s definitely changed a little bit. It used to be more like you’d actually know a lot of these people. Now it’s, kind of, become a mass, sort of, monetization thing. I think that they’re just trying to make as much money as possible on it. They also host an affiliate conference called AffiliateWorld Asia and Europe, so they’ve kind of grown that into a more prominent sort of thing.
Andrew: All right. Then you ended up doing some kind of share exchange with the Codewise guys. How did you do it and why?
Robert:So in the beginning, we very much liked working together. And the guys started to see a potential of Zero park, and to see that, kind of, being a venture-building company is more alluring than just being a, kind of, typical outsourcing gig. So they were leaning towards it. I was interested in having my own developers. I had bunch of ideas which I would need development power to execute on. So at first, I think we exchanged, I think it was 30% Zeropark, 30% of Codewise. There are three of the founders, so they got 10% percent each.
Andrew: And you got 30% of their business?
Robert: Of Codewise, yeah.
Andrew: And then, in return for that, they didn’t become your full-time developers. Did they?
Robert: Essentially, yeah. I mean, not only was I still their only client, now I was also a shareholder, which, kind of, leads up to the story of how I ended up taking over the company.
Andrew: Yeah, Tell me about that.
Robert: So after a while, so there are three founders. One was a CTO, one was a CEO, and then then the another one was the later CTO. He was, kind of, the brains behind it all. And he, kind of, was in the background. And I got along really well with him. But the CEO had a bit of a power trip. He’s now a successful founder himself. He has a company called Kontakt.io, which is a Bluetooth beacon company. And the CTO then, he smoked a bit of too much pot and he made a couple of mistakes which cost me one day and four hours on this Right Media Exchange cost me $300,000 because he fired back all my postbacks, all my conversions from a month period in four hours. He fired them back, which would charge my account. And that was a day before I took my first vacation like three years. So it, kind of, ruined that for me.
So that happened, CO had a bit of power trip and on vacation I was like, I don’t think I can work with these guys anymore. I love working with Bartek. He was the third guy. And when I got back, I met with Bartek, and we decided that he feels the same way and we need to do something about it. So we went from our headquarters was around at Krakow, we went to Warsaw to meet my lawyer, and my lawyer said it’s easy. I’m their only client, if I cut off funding, they’re going to go bankrupt within three four weeks. They just won’t be able to pay anyone or pay for the office.”
So that was the angle used. We went back, and I told him I’m no longer going to be their client. And they knew what that meant. They didn’t expect it. I see that like it was the easy thing, but it was one of the most difficult things I’ve ever done in my life.
Andrew: You’re basically using your power to take over their company and you’re not hiding it, which I respect. Frankly I’m glad that you’re willing to do it. But that’s it, right? Willing to talk about it, is what I mean, right?
Robert: Yeah. You know, I think if I hadn’t done that, we’d all be in a worse place not to say, you know, not to justify it. I just knew I had to do it for the company to keep moving forward.
Andrew: Why are you willing to talk about it? Why aren’t you being like so many other entrepreneurs, which is, open with me in private, and then in public saying, we just had a falling out we decided that we each wanted to be our own CEOs and we moved on. Why are you talking about it so openly?
Robert: I’m a bit of an open book, which is sometimes works not in my favor, but I like to talk about it because it was one of most difficult decisions I’ve ever made my life. And I think telling a kind of truthful story might empower certain other people too to think in the same sort of categories.
Andrew: You know what? I’m with you. One of the reasons that I don’t like the how I did a podcast, which talks to famous entrepreneurs, is they never get to this stuff. It’s always hidden. And I know it, because I’ve been studying them, like why can’t they be more open? Because it’s more of a PR thing for them, I guess. All right. So how much did you pay to get them to leave?
Robert: They wanted . . . I don’t remember what they wanted.
Andrew: Quarter a million dollars?
Robert: Yeah, yeah. That’s what they wanted. They got, I think $100,000, 50 each.
Robert: Yeah, 50, each yeah.
Andrew: Fifty each, and then they moved on.
Robert: You know, at that point, the company was not profitable. Like people think a lot of times people might hear the story of a . . . I call it a hostile takeover. I mean, it was hostile. And they think I took over some sort of profitable company. But we didn’t have profits anywhere in sight at that point in time. We were hiring, I think, 10 people or something like that. We had quite expensive office, and, you know, I had a feeling that Zeropark was on the verge of something, but there was no proof. There was nothing that stood behind that feeling. So, yeah. They wanted a quarter of million, ended up paying each $50,000.
Andrew: And you were still funding this business from the affiliate revenue? It wasn’t self-funding.
Robert:I mean, so funding in fact that, you know, it was my own profits still being pumping it back in.
Andrew:I mean, Zeropark wasn’t producing enough money to pay for all the developers and all the marketers.
Robert: It was losing money.
Andrew: It was losing money. Meanwhile then, my researcher just copied this into my notes here. You at one point had to go and hire people and you said, “I had to hire these guys by lying about how well we were doing.” I think this is something that everyone does and no one talks about it, and I’m glad that you are. Tell me, who is it that you were trying to hire? And what was the lie that you needed to pull off?
Robert: Sure. So it was what I mentioned earlier in the early days, you know. To get the developers that we deemed were good enough to execute for us. To get them to leave their comfortable sort of corporate jobs and take a risk on an unknown startup that has nothing to show for itself. We had to lie straight up. We had to say, you know, we’re financially secure, which to an extent we were, because I was in a position to back it. But we had to create the illusion that this is a good opportunity for that specific candidate. I mean, we had to do this a few times.
One of our first hires is now a CTO of Codewise. Another one, he manages Zeropark from the tech side completely. So our earlier hires were actually some of our best hires, and all those guys are still with us today.
Andrew: And the lie is, “Hey, we’re doing great. This is a solid place to work, and it’s not exactly a lie. The software is not where it needs to be, and the marketplace isn’t, but you’re doing well. I heard, and this I don’t have anything to back up, but I heard that you showed them checks, or dashboard of revenue, or something to show them that we’ve got money.
Robert: I don’t think we ever went that far.
Andrew: You didn’t do that?
Andrew:You just reassured them?
Robert: Yeah, like you said. I mean, it’s been a white lie, kind of, you know, more colorful manner presenting the way things are. [crosstalk 00:31:45]
Andrew: You know what? I had to also lie to my wife and tell her things are okay, when in reality I go to bed like scared, but I don’t want to impose my fear on her.
Andrew: You kept pulling in more customers. That’s partially what helped this thing really grow. What did you do to get more customers at Zeropark?
Robert: Sure. So what we did was we continued with the sort of conference-driven approach, but now we started going to the conferences in the U.S. specifically, Affiliate Summit in New York and in Vegas. And it’s shocks a lot of people, but to this day, we don’t have a sales team. We don’t have any sales activity in our company. We’re just something we’re looking into now is one of the reasons I’m in Santa Monica is to build that sort of [inaudible 00:32:34]
Andrew: Yeah. I was hunting on your website and I saw that there were a lot of career options for people who would want to be account managers. But you don’t have any and you haven’t had them until now.
Robert: So account managers we don’t consider sales. They’re more of people who . . .
Andrew: Manage the account after it’s sold.
Robert: Exactly. But to get the account in the first place, the only thing we did was Stack the Money forum where a lot of the big spenders were, and conferences namely Affiliate Summit in New York and Vegas.
Andrew: And you’re very proud that unlike other people who are too wimpy to spend money and too over-analytical about it, you do what?
Robert: I mean, I don’t know if I’m proud, but it’s just something I discovered that works for me is putting myself in a do or die situation where I put up so much money upfront for a big show that has a lot of potential, and if we don’t deliver in time for that, we’re screwed. And it just brings out this part of me that never comes out otherwise unless I’m in a do or die situation. So I just took advantage of that over and over . . .
Andrew: You put yourself in that situation. I have to perform. And when you do, what’s an example of something that blew you away that made you say, “God, I could never do this if I hadn’t put myself in this do or die situation”?
Robert: I mean, just, there’s so many of like these moments where we had this upcoming conference. You know, sometimes $300,000 spent on a booth that we couldn’t necessarily, you know, we couldn’t come back from that show like that with nothing, or it would put us in a very tricky cashless situation. Just the amount of the way you prioritize in those situations is like in another level.
Andrew: So you’re not wasting time at all.
Robert:You’re not wasting time, you cut through the bullshit, you’re like, “Okay. This feature is redundant. We don’t need this ruse conference.” And you just end up with what you really feel you know.
Andrew: I see. You’re saying, not only does it make you be better at the conference, you’re saying even before the conference, you got a team of people who all know, ‘This guy just spent $300,000 the we can’t just throw around because nobody can throw around $300,000, and we have to make it pay off by adding these new features fast.” And then, once you’re there, how do you not look desperate? How do you not look like you have to make back your $300,000?
Robert: Well, we usually deliver it on time. So we’re usually pretty proud and pretty impressed [crosstalk 00:34:52]
Andrew: So I mean, when you’re talking to people, is it just that the feature speaks for itself? Or do you feel like you need to sell someone, so you bring back a $300,000 account?
Robert: I think that pressure presents itself in a positive, sort of way at those shows where you feel like you’ve gotten the work done that you had to get done to be where you wanted to be at, and now you’re just proudly, kind of, presenting and showing the new things that we’ve come up with. So it worked out well. I don’t think there was never really any stress at the show like with every interaction with the person that we have to get a lead out of this. It’s just, kind of, flowed naturally.
Andrew: I read on the Medium post. You know your Medium post, Instapaper said even at double speed it was going to take me 40 minutes to read the whole post? Did you write that whole thing yourself?
Robert: Yeah. It took me a long time. I wrote a first, kind of, version of it. It was much shorter for this affiliate site. And then I decided I, kind of, wanted to do it for myself, because people would ask these questions, and I’d mix up dates and things like that. I kind of wanted to get this part of my career down paper. It took me half a year on and off to write that thing. It was a bit of . . .
Andrew: The untold story behind the fastest? Where is it? The untold story behind a fast-growing company in Europe, this is Medium is saying 46 minute read. And it’s a long, long, long story of how you did this. And one of things that you said in there was, because I don’t have any attachment to money, I feel very confident rolling out a $300,000 spend on a booth and not feeling desperate, because I know that it’s somehow going to come back to me, and I’m not going to sweat the money. That’s what you mean?
Robert: At this point, yeah. Back in the days when we would do it, not necessarily.
Andrew: How do you get to a place where you can do that, where you can get to that comfort level?
Robert: I mean, you have to become profitable enough. And honestly, I think we were, you know, for the past two years, we’ve actually, kind of, stagnated, plateaued, I would say. We became comfortable. We lost that, sort of, approach of putting ourselves in these difficult situations to continue the sort of hyper growth. We got a fancy new office, and I found myself kind of, just coming in, and look and we’re profitable. And there’s not really much that I have to do to move forward. And so, it took me a long time to, kind of, find the energy that, kind of, start of the energy to fuel the warmth to start grinding again.
Andrew: What did you do to get it back? You moved to Santa Monica.
Robert: I moved to Santa Monica. That did me well. Personally I was a very unhappy person in Krakow. That’s not the city I’m from. I didn’t have any friends there. So it was pretty much six years of just, kind of . . .
Andrew: Why were you unhappy?
Robert: Perhaps unhappy is a bit of a strong word. I just didn’t have a personal, I didn’t have a life outside of work.
Robert:[inaudible 00:37:37] to build that.
Andrew: And still that Medium post that you did started off with a statement about how entrepreneurship is about doing what nobody can for a first few years, so that for the rest of your life you can do what nobody is able to do. And so, you did it. You pushed yourself intentionally. Lots of hours, you said, I have to sacrifice it all, so that I can get . . . and did you have a visualization of what that payoff was? Was it people showering you with attention in the U.S.? Was it being a billionaire? Was it finally telling your parents you didn’t believe that you should be an entrepreneur, I did it?
Robert: You know, the various points in time was probably a mix of those. I think in the beginning, when I was still, you know, starting out 24, 25. Because of my low self-esteem, a lot of the things I was doing was to prove to the world and to others to show my worth. I’m now at a point, you know, six years later, where I know my worth and I do things for myself to prove to myself.
Andrew: Is there a person that you would visualize in your head that I’ve got to show him that I’m worth it?
Robert: It was, kind of, everybody it was . . .
Andrew: Kind of, the universe as a whole.
Robert: Yeah. I was, kind of, I was angry teenager remnant energy, that, you know, I’m going to show everybody . . .
Andrew: Did you listen to “happy metal” as a kid?
Robert: Not really.
Andrew: No. What was your music?
Robert: It was a bit of hip hop.
Andrew: And so, when you’re listening to hip hop, hip hop is really big about being showy.
Robert: Eminem was big for me. And I’ll listen to his music.
Andrew: How did Eminem speak to you?
Robert: Oh, he’s just so open about as soon his anger and his distaste and things like that. I remember I would walk around with my Discman [SP] listening to it on loop.
Andrew: That song prove yourself.
Robert: I think that’s a little later. I can’t remember now.
Andrew: Okay. But you were just listening to it, you felt like you had to show the world that you’re right. You know, let me say for a moment, I’m not going to do a full ad for Toptal. I’d just say, if you guys are looking to hire great developer, go to toptal.com/mixergy. They’re really proud of the fact that they bring the best of the best of developers. And when you go to toptal.com/mixergy, you’re going to see incredible offer that they make just to mixergy listeners. That’s top as in top of your head, tal is in talent, T-O-P-T-A-L.com/mixergy. You don’t have to do takeover, or a hostile takeover developer shop to get the best of the best, Toptal will do it, toptal.com/mixergy.
All right. You had a breakdown or feels like, like you said, “What am I doing here.” Bartek seem to have had an even bigger breakdown, the guy just leaves. Was it just a fast, “Hey, listen, we’re partners in this, but I got to go”? Or did he take off and then text you and say, “I’m out of the country. I’m done.” What happened?
Robert: Yes. So this was the, I would say the highest point, at least financially speaking of the company. We’re more profitable than ever, we’re doing a little EBITDA $1 million a month. He went away on vacation . . .
Andrew: Wait. EBITDA $1 million a month.
Robert: We were like creeping up on that, yeah.
Andrew: Okay. And then he goes on vacation because he’s just what? Feeling?
Robert: I could see, you know, he was a CTO, he was dealing with all the developments. So it’s important for me to say that a lot people think I’m a developer. I’m the worst developer I’ve ever met in my life. Like I had to hire a guy in high school to do my C++ homework for me because I was about to fail high school. Later, looking back at it, I’m like, “That was delegation.”
He had the whole, you know, we’re a tech company, so SaaS, 24/7 on Amazon cloud. So he was like nonstop making sure everything’s running smoothly while I’m just kind of blissfully unaware. And so, I started to see he’s burning out, and he approached me saying he wants to take a vacation. I was like, “Take a month off please.” Like, “Just go and switch off, which he did. He went to Japan, uninstalled all the social networking and emailing apps on his phone, went offline. And the day he got back, sorry. While he was away, I’m starting to have thoughts that this is a little bit overwhelming. I never thought we’d grow to this, sort of, scale. I think we’re only like 60 or 70 people at that point.
And I started having feelings of wanting to . . . I was hoping the company would go bankrupt secretly. It’s really . . .
Andrew:So you could do what?
Robert: So I could abandon it without looking like I gave up, I guess. Really messed to say out loud. But I had a lot of thoughts like that frequently. I was like, “I hope this will just collapse, and I can be free.” And like “I’m tired of this.” And so, he came back, and I was planning on telling him how I feel that I want to talk about exiting somehow. And before he comes in the office, he shoots me a message. He’s like, “Rob, I need to talk to you outside of office.” So I’m like, “Oh.” You know that feeling or you like you know something’s happening. Now, I will go to meet him and he says, “Rob, you’re not going to change my mind. I want out. You either going to buy me out, or I’m going to stay on as long until we sell the company together.” And we went away for a few days to talk about. And I ended up buying him out.
Andrew: How? So I heard that you went out, you got this appraisal of the business, it freaking blew you away, because they said it was worth how much?
Robert: They gave me a range, and I met some investors in California. I had never previously met with any investors. So I had no idea. I had sent them all our financial information, they came up with a range, I think it was between $240 million and some upper number. It was ridiculous.
Andrew: Quarter a billion dollars valuation space. That’s what you’re saying they gave you?
Robert: Hypothetically, that they could potentially find some companies that would be interested in a business like ours. You know, keep in mind, this was at a point where we were growing like astronomically fast and profitably . . .
Andrew: Before, you know, the plateau that happened last couple of years?
Robert: Yeah, exactly. So I had that conversation with him. I told him, you know, I don’t think I’m enjoying my money, and they’re like, “Wow, we hear this from every entrepreneur until they see the check. They all say that.” But, anyway, going back to Bartek, he lowballed me, he prefers me not to say how much but it multiples under the evaluation, many, many multiples.
Andrew: Why did he lowball you? Because he didn’t know. He didn’t have that analysis.
Robert: No. He knew. We were still very close. We never had any, sort of, falling out, so this sort of him wanting to leave, or me wanting to leave had nothing to do with each other. We’re just tired in general of managing people, you know, and things like that. So we’re still very friendly, and it was a friendly offer from his end. That’s all it was, really. f
Andrew: For several million dollars and you were able to pay it off already with profits from the business?
Robert: I just paid him cash, yeah.
Andrew: You just paid him cash the day of:
Robert: Well, shortly after we established legalities and all that.
Andrew: I heard you just, “Wow, yeah. That’s unbelievable. I feel like your . . . I don’t know what to make of you, because you’re really a nice, friendly, looking guy. There’s a photo of you, of your billboard all over that place, was that longest billboard in the world? That’s what I heard it was.
Robert: Yeah, That’s in Krakow. It’s actually the biggest outdoor billboard in Europe.
Andrew: In Europe, yeah. Just like really nice-looking guy, but then I feel like, this dude’s a killer, man. He gets his two co-founders out, his best friend leave . . . not his best friend, his close friend. Maybe your only friend at the time, leave the company for tiny amount compared to what it is, and now you own this whole business, and then, you go out and you write posts about how vulnerable you are. And you are crying, having to wash your face with cold water. And so, everyone still loves you even though you like, I don’t know.
Robert: I wouldn’t say everybody still loves me. A lot of people have that exact image of . . .
Andrew: You’re a killer.
Robert: Yeah, of . . .
Andrew: What the word that you would use? You secretly know it and it eats away you. What’s the word that they would use to describe you? The people who worked with you, who are closest, who are angriest?
Robert: That worked for me in the past?
Andrew: Yeah. The people who are angriest. What’s the one word that they would use that pisses you off a little bit, but also there’s a sense of truth in it?
Robert: You know, we haven’t . . . there aren’t that many people in the world that used to work with us. Most people that joined us, we have like almost no turnover with people. I don’t know to be honest. That’s a tough question.
Andrew: All right. So then you said, “I got to shake things up, I’m moving to Santa Monica, because I don’t want to end up burning out like Bartek did. We’re on our way.” How did Santa Monica free you of that?
Robert: So, the first time I was in Santa Monica in California was with Elephant Traffic, it was two months after I joined that company. I was an intern, nobody really gave a shit about me. And they were going off to this conference, the biggest domain in conference in the world at that time in Santa Monica at the Fairmont Hotel. And I was like, “Oh, my God. I really want to go to that. There’s no reason why they would take me.” So I spoke to the CEO. I’m like, “Listen, what if I pay for everything myself? Can I please go?” And there was no reason for him not to agree to that. So I bought my own ticket, took care of all that, and I went off with him, and, I, kind of, proved myself my worth at that conference by working my butt off.
But at the same time, you know, I fell in love at Santa Monica. I traveled quite a bit, at a younger age with my parents. And it was only place in the world that I had been where I felt like this is a place I would want to live one day. And I think subconsciously, everything I did for the seven years that followed, kind of, led to finally making that difficult decision to jumping continents, and that’s why I’m here now.
I strategically New York would be far more suitable for our needs. Personally, this is where I wanted to be.
Andrew: And so, I feel like Southern California is full of marketers, full of smart affiliates, right? It’s that space. All right. You said that you talked to our producer, you said, “Look, one of the hardest part is loneliness as an entrepreneur.” What does that feel like to you when you say loneliness, and then how did you deal with that by going to Santa Monica?
Robert: I think, I mean, it’s difficult to have sort of deep conversation with friends that are working in comfortable jobs at corporations, you know. They don’t really understand the struggle that entrepreneurs go through. They, kind of, see it on the surface as glamorous life traveling, working whenever you want. But we go through some heavy shit, and I think we can only relate to other people that have gone through the same thing. And being in Poland, having grown the business, I was isolated. I never went to any sort of startup conferences. I just kept my head down and worked. And so, I never had that opportunity to meet these similar-minded people. Truthfully, I still haven’t. I still, kind of, my introvertedness wins most of the time, And, you know, after working, I just want to be on my own typically So it’s a bit of a . . .
Andrew: So you’re around people at least, and it’s an interesting, uplifting environment to be in sunny southern California. But you’re not . . . if you found someone who is in your space, would you want to hang out with them?
Robert: Probably, yeah.
Andrew: You would? So, if there’s somebody in Southern California who was in affiliate marketing, who was doing high sales not just getting started and looking for ideas from you, you’d want to hang out with them?
Robert: Definitely, yeah. And, you know, not necessarily from affiliate marketing, preferably even not so.
Andrew: Outside that space.
Andrew: All right. Well, the good news is they do exist in Southern California. All right. For anyone who wants to check you out, I did a poor job of talking about your product, but we kind of knew going into it that that’s not the focus of the conversation. I was happy that you said that you didn’t want to promote the product. Anyone who wants to go check you out, can go see zeropark.com. Or frankly, I like your YouTube videos. I think you guys do a great job of explaining what the software does there. Or, they can go to Voluum which is spelled V-O-L-U-U-M.com, which I did not talk about at all except for screwing up in that intro. And, of course, there’s Codewise, the parent company. All right. How do you think the interview went for you?
Robert: I enjoyed it. It enjoyed, kind of, openly speaking about my journey about the difficult moments, the vulnerable moments. I think it’s important. I think a lot of people, it’s easy to put on this facade that you’re tough and nothing happened. But it’s hard. It’s hard. And people, kind of, I think it normalizes it to potential entrepreneurs as well. That they know that their struggle isn’t unique to them, but everybody goes through this.
Andrew: All right. Well I think also a nice follow-up is to go check him out on Medium, that post that I mentioned earlier, is called, “The Untold Story Behind the Second Fastest Growing Company in Europe.” Robert Gryn, thank you so much for being on here and doing this interview. And I want to thank my two sponsors, activecampaign.com/mixergy and toptal.com/mixergy. Thanks so much.