What to do when a business gets too big for a DIY founder

When you’re starting as an entrepreneur, much of your growth is caused by what you can do.

But what happens when the business gets so big and you can’t fix things yourself? What happens when you have to go from being a doer to a manager?

Today’s guest says that’s what happened to him. Rick Backus is the co-founder and CEO of CPC Strategy, the number one retail search agency. I invited him to talk about how he made the transition.

Rick Backus

Rick Backus

CPC Strategy

Rick Backus is the co-founder and CEO of CPC Strategy, the number one retail search agency.



Full Interview Transcript

Andrew: Hey there freedom fighters. My name is Andrew Warner. I am the founder of mixergy.com and a fast talking Internet guy who apparently needs to slow it down. You know, I used to talk really fast, and I’ve learned to slow it down. But, every once in a while the speed creeps in.

This interview is with an entrepreneur who says that things were good at first and he was able to do much of the work himself. But, eventually, what you will find, you the listener, as you build your business up and it gets bigger and bigger, you can’t fix everything yourself. You can’t do it all yourself, and that’s when you have to go from being a doer to a manager.

For most entrepreneurs, that is what causes the big problem that makes their companies fail because we’re not trained to be managers. We fought against being managers. Here we are as entrepreneurs running a company that needs us to be managers. So, how do we do it?

I invited today’s guest to talk about how he did it so we can learn from him. He is Rick Backus. He is the cofounder and CEO of CPCStrategy, a retail search agency.

Before I do the interview, I’ve got to tell you that… Let me give you guys a little tip. I created this landing page on Mixergy, it took me about a year to get it right, that converts at over 20%. Maybe even one out of four people give me their email address on it because it’s so good.

As an experiment, my friend Clay Collins copied it and is making it available to you if you want to try it. It’s an experiment. I may not continue to do it. But, if you want to try it go to andrewswelcomegate.com. It’ll work for you on your site LeadPages. We’ll make sure that it is.

If you’re looking for something that converts phenomenally I guarantee it works… No, I’m not guaranteeing anything. I tell you it works for me. I’m letting you copy it. You can even change the name Mixergy to your own thing, change the logos to your own logos, whatever.

Go to andrewswelcomegate.com. It’s powered by LeadPages, and I appreciate them sponsoring Mixergy.

All right. Rick, welcome.

Rick: Thank you for having me. I appreciate it.

Andrew: Glad you’re on here. When you started out, it was how many people?

Rick: Before I answer your question, I want to thank you. It’s a little bit surreal to do an interview with you. I have to be honest. I probably watched about 200 of your interviews previously.

Andrew: Wow.

Rick: As an entrepreneur, you and your guests have been a huge inspiration to me. We started the company seven years ago. There are a lot of times where you’re trying, kind of searching for what the next step is. You’re looking inside yourself to figure out how to be better, how to grow into this leader that your company needs.

You and your interviews have provided that for me a lot of times. So, thank you for having me. Thank you for what you do. As entrepreneurs, we genuinely appreciate it.

Andrew: Then I’m so proud to have you in the audience. I’m telling you, I used to just do this interview because my previous company failed, and I said I’ll just have an excuse to talk to people so I can learn from them.

In the back of my head I had this dream that someone else is going to listen to it, use this, and build a successful company. I’ve seen it over and over again, and it’s a testament to just saying you know what, I’m going to keep on doing it. I’m going to keep on producing. If there’s someone out there who’s struggling and says hey, you know what, what if no one’s paying attention. Keep adjusting. Keep working on it.

Rick: Yeah.

Andrew: I think that when you eventually get there you’ll forget how tough it is and you’ll just be proud. All you’ll be left with is pride of the results. I know I am right now. I forgot how tough it was in the early days, but I remember and I feel so proud to know that you were there in the audience listening. So, thanks for doing that, and thanks for actually coming back here and doing an interview yourself.

At the time you started you were just a guy, right, with a business idea which we’ll talk about. Today, how many people are you?

Rick: Today there are 26 people at the company. We actually hired two in the last two weeks.

Andrew: Wow.

Rick: And, there are three more positions that are open. So, by the end of this year we should be up to 30. But, yeah, today it’s 26.

Andrew: How much outside funding have you taken?

Rick: None.

Andrew: Nothing.

Rick: Complete bootstrap.

Andrew: Just bootstrapped it. Just you and an idea. Developed it with three other cofounders who came in afterwards, shortly after you started.

Rick: Yeah.

Andrew: And today so many other people. What size revenues are you doing this year?

Rick: It took us five years to get to $1 million in revenue. Last year we did $2 million. This year we’re on pace to do $3 million.

Andrew: Wow, wow, congratulations.

Rick: Thank you.

Andrew: Before this, you were at PriceGrabber. What did you do at PriceGrabber?

Rick: Yeah. I’ll give you a little bit of back story. I went to UCLA. After I left UCLA, my initial goal was to work in sports. I thought that I liked sports. It seemed like something that would be a good fit for my skill set.

I initially worked for the Los Angeles Avengers which at that time was an arena football team. The only positions that were open were around sales. My first day…

Andrew: Are the Avengers gone, by the way?

Rick: They’re gone, yeah. It’s like Los Angeles Kiss now or something.

Andrew: Oh, okay.

Rick: It’s a completely new team. But, the Avengers… This was back nine years ago. The Avengers, I had a sales role. It was supposed to be warm leads that I was reaching out to, but the first day I made 500 calls, and nobody knew who the hell I was realistically. And it was about a week of that that I realized I want to work in sports, but this is absolutely awful.

I’m coming out of UCLA. I think that means something, that I should be doing more in the world. And so I actually went into the building which was the largest building in Westwood which is where UCLA’s located. And I went to the guy downstairs and I told him, “I want to work in this building. I have my resume. I wore a full suit. I want to work in this building.”

And his initial reaction was like, “No, that’s not the way it works here. I park cars. You’re not supposed to be here. Please go away.” “No, I have a resume. Tell me where to go. I want to get a job today.” So he sent me to a temp agency on like the 14th floor which was . . . I went up there with 30 minutes of typing. I’m actually not that bad as a typer. It was a pretty terrible experience.

And then the 12th floor which was PriceGrabber and the elevator opened and there were flat screens everywhere. Instantly to a kid just out of college it looked like a cool tech environment that you want to work in. I got an interview that day. I was hired two days later at PriceGrabber to start on their sales team. It was my job to bring on new accounts at PriceGrabber. And so, yeah, that’s how I got started there.

It was an online comparison shopping site and so everything that I learned led to CPCStrategy started at PriceGrabber.

Andrew: PriceGrabber is the kind of site where if I wanted to buy a tie, I guess, I could just go to PriceGrabber, type in tie, or maybe coffee maker is a better example, and they’d give me a list of all the places where I could buy it, prices at those places, and I get to go and buy from there.

Rick: Yeah, exactly. It’ll tell you all the sellers. It’ll show you the prices that the sellers will have, feedback on the individual sellers. And so you’re just trying as a consumer to figure out the right place to buy that tie or that coffee maker.

Andrew: Okay, and do you help promote companies there?

Rick: I help to get the retailers on to PriceGrabber. And so, for instance, the client who has ties or has coffee makers, they’re trying to figure out where to acquire customers at a rate that’s profitable for their company. And the pitch from PriceGrabber’s perspective is we’ll tee up the customers for you, we’ll send them back to your website for you to convert. And as long as you can acquire those customers at a profitable rate then PriceGrabber is a great investment.

Andrew: Gotcha.

Rick: That was the pitch.

Andrew: So what did you learn from that?

Rick: I learned that retail and specifically marketing in retail is extremely difficult, and a lot of the retailers were great at shipping their products. They knew how to do customer service. They knew fulfillment, but when it came to paying per click, when it came to creating a data feed with all of their products, it was very complicated to them, even for 10, 20, $30 million retailers. They didn’t understand how to efficiently market their products online.

And so, for instance, at PriceGrabber, you know, they may have 20,000 SKUs. They would list all 20,000 SKUs initially and just let it run. So they may only have 100 of those products that actually were profitable that were doing well, and they would list the other 19,900 products that were killing their ROI and they just didn’t do anything.

Andrew: Because they didn’t know. They looked at it all as one big ad buy.

Rick: Exactly.

Andrew: And they say, PriceGrabber is either successful or not as opposed to saying, “You know what? PriceGrabber in general might be successful, but 60% of our products are losing us money. The other 40% are making money, let’s get rid of the 60% from PriceGrabber. Let’s focus on the 40. We increase our revenue from there. That’s what you’re talking about. They didn’t know how to do that.

Rick: Exactly. The purple ties are profitable. The yellow ties in size small are killing my ROI, and there is nobody going through serving us as an analyst and say, “These are the products performing well. These are the products that are losing me money, and that’s essentially the idea for CPCStrategy was to manage these online retail channels. So to help the retailers to figure out here’s the channels you should use. Here’s the products that you should list. Here’s what you should bid on each individual product.

And so our value proposition to the retailer was you give us a budget of $10,000 a month. You tell us the ROI goal, and we’ll handle the rest for you. As long as we’re driving profitable traffic then you’re going to work with us as an agency for a long time.

Andrew: That’s the original idea.

Rick: That’s right.

Andrew: I heard you wanted to test the value prop and see if it was even worth pursuing. How do you test something like that?

Rick: Yeah, so I think earlier on there’s . . . We adopted later on the model of inbound marketing. Inbound marketing, I think, is a great way to scale your company. It’s a great way to establish credibility. Early on I see a lot of entrepreneurs get stuck in this cycle of ideas, and they have no real concept of how to validate their ideas. And so for me, that validation came in the form of cold calling. I had a list of potential clients.

Initially, I said that we were going to focus on jewelry. At that time, jewelry was selling really well online. It was before the recession, and if you sold watches, or any form of jewelry you were going to do really well. And so, I had a list of 200 jewelry sellers that I was going to reach out to. My idea or my thought process was I would probably have to call all 200, and I’d be lucky if any of them talked to me seriously.

Andrew: It was cold calling? It wasn’t going back to the price grabber people who you met and saying, “Hey I know you’re buying ads in other places. Let me manage that?”

Rick: No. It was cold calling, and so I . . .

Andrew: Why didn’t you start with the people that you knew?

Rick: I was really paranoid that price grabber was going to sue me or something, that it was a conflict of interest, and that in my original agreement I’d signed some sort of NDA that didn’t allow me to reach out to those people. I’ve since learned that in California that can’t be enforced anyway.

Andrew: Yeah.

Rick: But, yeah. That would have been an easier start, but I didn’t do that. I didn’t . . .

Andrew: Well I don’t know about that actually. I know that in California they can’t keep you from working for the competition, that they really protect employees a lot. But, if you take inside information from a company that could be a problem.

Rick: Yeah, I was always just super paranoid about it . . .

Andrew: I get it.

Rick: . . .wanted to play by the books, and I didn’t know Sky-walker[SP] at that point. [???]

Andrew: [laughs]

Rick: . . . for that leverage, that relationship at all.

Andrew: I see. So your thing was saying, “Hey you know what? Let’s go outside of where I usually work.”

Rick: Yup.

Andrew: “Let’s just talk to jewelry makers. I’ll cold call them, and the way I’ll see if my idea has legs is to say: Will you pay me to manage your pay-per-click ad buys?”

Rick: Yup.

Andrew: And that was the original idea. You cold called. And then you got a client, I imagine, right?

Rick: Yeah. The very first call, actually.

Andrew: The very first call?

Rick: Very first call, yeah. I reached out to him. He didn’t hang up on me. He expressed some sort of interest in what we did. He asked me about pricing. At that time, I didn’t know even what I was going to quote him. I told him to hold on while I talk to our accounting department. [???] Obviously tying to give the illusion that you’re a bigger company. I put the phone down, looked over, my cat was right there on the bed, and that was about the extent of when I put him on hold. I quoted him $1,000.00 a month. He said, “I’m in. Send me the contract.” This was all like a 10 minute phone call. The very first one.

I hung up the phone. I was ecstatic. I called my girlfriend, who is now my wife, let her know I’d reached out to my friend Will, who is one of the co- founders of CPCStrategy, who is still a price grabber. I told him to send me a PriceGrabber’s agreement. He’s like, “No I can’t. You can’t just sub out the logo, and use the same agreement.” But that’s what we did. PriceGrabber don’t hold that against us.

Andrew: Oh, wow!

Rick: For the. . .

Andrew: Okay.

Rick: . . . for the first agreement. And yeah, from that point forward, it was actually pretty easy to acquire customers. What we did is we focused on one vertical. And so, we said . . . We created a case study around jewelry sellers. And . . .

Andrew: Well, let me go a little bit slower then. . .

Rick: Okay.

Andrew: . . . Because you must have said something to this first jewelry company that made it worth his while listen to you, and to try you out. What was the. . .

Rick: Yeah.

Andrew: What was the value proposition that you made that made him say, I mean . . .

Rick: The value proposition was all around being . . . having this insider’s angle. And so, you, what I told him is you have the potential on price grabber to sell significant volume. To be efficient with you campaigns, you need to understand how that work. I used to work at price grabber. I’m still very connected to the account management team at price grabber. I can help to run these campaigns for you based on my first-hand experience, and the focus is all on jewelry.

So jewelry is our category. So not only are you in a small vertical which jewelry was, but it’s a small niche. It’s comparison shopping engines for jewelry. And so, I knew that we couldn’t compete if we tried to do CPC for every single retail category online. But, there is no one who had a pitch that was I do comparison shopping engines for jewelry. And so it was so focused, it was so narrow, that I feel like the value proposition initially was pretty strong.

Andrew: And is it the kind of situation where if he makes one sale, then it pays for your monthly fees?

Rick: Yup. He had . . .

Andrew: Just one?

Rick: He had Rolex watches that were $10,000.00 a month. That if we could get him one extra sale that month, it was going to be worth it for him. And so [??]. . .

Andrew: And did that factor in when you were looking for companies to cold call?

Rick: Yeah. That was one of the parts of the pitch was if I’m trying to help you sell $200 trinkets, I’m going to have to increase your sales volume by 500 orders per month to pay for my monthly fee. Whereas if you’re selling these watches or this jewelry that sells for $2,000 – $3,000 as the average order value, I increase your sales by four or five items that month, and it makes us a good investment for you.

Andrew: And while you were servicing this one client, were you also still working at PriceGrabber?

Rick: I was not. And so, I had left price grabber already. The time in between PriceGrabber and the first cold call, it was actually about three months of building the website. At that point, I was already communicating with Nee, who’s one of the co-founders of the company who was at eBay for that time and the year after we got our first client. It was Nee and I on the phone every single night for two to three hours. My wife, at the time, thought that I had some sort of other lover or was cheating on her, but she, I put Nee on the phone to show her that it was actually, but yeah. It was all about the website and the content, the value proposition, the business plan, so all of that . . .

Andrew: So you get this one client, and now you have to start getting some results for him.

Rick: Yep.

Andrew: And that means going out to the different comparison shopping sites for jewelry and listing them on there. That had to be a slam dunk. How many were out there and how hard is it to get listed?

Rick: So it was pretty easy to get listed. The challenge for me was to figure out the other comparison shopping outside of PriceGrabber. I knew PriceGrabber so well, but at that time it was Nextag, Shopping.com, Shopzilla, Google shopping at that point was called Frugal. It’s gone through like ten name changes since then. But there was about five that were the core comparison shopping engines, and so we just took the client’s budget. We allocated $2,000 to each of those shopping channels, and Frugal was free at that time, so it was really $2500 to four channels and set them up for the free campaign on Frugal.

And, that was it. Just monitor the ROI for each channel, make the individual product cuts for products that weren’t performing well and it was a home run. He stole a client today, and so it was a good category to start with, and it validated that we’re doing something right here, both from a sales and delivery perspective.

Andrew: So he didn’t even know that he could be on Frugal, let alone set the time aside to go list himself there. Even though it was free, it was just not, he wasn’t using it.

Rick: No, they knew. They knew. So Frugal was the one channel that everybody was on. The challenge for them was the paid channels. So PriceGrabber, Nextag, Shopping.com, Shopzilla. They didn’t understand, it was exactly what you said at the beginning, they viewed it as a portfolio where this is an ad buy. And they weren’t managing the channel by product, they were just throwing money at the channel and whatever it returned it returned, without understanding that there was nuance to the channel and they . . .

Andrew: So what could you do, did he have enough tools for you to really evaluate each individual product?

Rick: Yeah. So each of the channels allows you to see the spend by product, and so you could log into PriceGrabber or Nextag or shopping.com and Shopzilla and see the spend by product.

Andrew: And you could probably connect it back to the orders easily, because he’s not selling that many. Did you have any software that would help you or were you eyeballing it?

Rick: So what each of the shopping engines would do is they would have a tracking pixel, like a java script code that would be installed on the retailer’s website, and so we could see the orders per channel. And so that complexity actually worked in our favor. So the retailer, instead of them having to log into these five different channels to try to figure out their ROI, they just let us manage the channels for them.

Andrew: You mean you personally, your company, put the pixel on. And so what software did you use to pixel?

Rick: So each of their pixels, PriceGrabber has their own one, Nextag has their own one, and so we would help the retailer install it on their website.

Andrew: So Rick, what I’m getting at is you basically did something that he could do on his own, but he didn’t want to figure it out and for you it was an easy thing to do because you’d been doing it for so long and frankly, putting a pixel on a site is not that hard.

Rick: Nope.

Andrew: So it was a fairly easy win, right?

Rick: Yes. No.

Andrew: How did you know what to bid on? You still had, there was one potential problem.

Rick: Yeah, the biggest challenge with these particular channels was the data feeds. And so, what a data feed is is essentially that retailer who sold jewelry would have 7,000 SKUs. They would have to submit a file, which is called a data feed, with each of the individual SKUs. And to get that file accepted by each of the channels was a challenge. And so it was very technical. And so most retailers would have their IT department sending in this data feed to each of these channels, and then, once you go live, they would try to get their marketing person to manage the budget by product.

And so, for a lot of small companies, they didn’t have this IT department and marketing person that can work on the channel for them, and so we realized, as an agency, is if we can handle the technical part, we can handle the budget management part. This is a unique skill set that most retailers won’t have in house. And that was the real challenge. It wasn’t installing the java script, like pixels.

Andrew: It was how do I take this whole catalog of products and turn it into a feed that could go onto these sites. So how did you do that?

Rick: I knew how to manage the feeds. From working at PriceGrabber, we understood what those specifications were for the data feeds. We would send the feeds to each of the channels, we would get them accepted. But, you know, especially for the first five years of the company, that was a crucial part of our value proposition, was being able to work with feeds and product feeds.

Andrew: How do you take . . . was he using a standard shopping engine, shopping platform? I see. So you knew on the shopping platform well enough. He didn’t have to code it from scratch. You just have to know how to take that data that comes naturally from the shopping platform, massage it a little bit so that it goes into PriceGrabber and related sites.

Rick: Yep, that’s exactly correct.

Andrew: So basically, if there’s someone out there working for a company and he sees that there are a lot of clients that aren’t using the company’s product or aren’t using similar products, that’s a business. Call up potential clients and say, “I’ve worked there. I can help you out.”

Rick: Yeah, we talk a lot about creating order out of chaos. And that’s how we started the company realistically. There was a lot of . . . from the prospects’ perspective or our clients’ perspective, in this particular industry, there was a lot of moving parts and there’s a lot of complexity. And so if you can simplify that complexity and you can create order out of that chaos, you have a business there. There’s a business model.

The next step, which a lot of people, like I said, get stuck on, is getting that market validation. And you have to figure out a way to talk to 100, 200 people who are within your target market and see how they respond. But if you can create that order out of something that’s chaotic, even if it seems easy to you, and you can go to that market and you can validate it through sales realistically, you’re going to need to talk to people about this. If it’s software, you’re going to need to put your product out there soon, but that’s how you can quickly create a business.

And I think a lot of entrepreneurs or people who want to start businesses make it a lot more complicated than that. And they think that they need to have this light bulb moment where they think of the perfect idea and realistically, you just need to take something that you do really well that a percentage of the market is confused by and create some order out of that chaos.

Andrew: I get that. You know what? I want to do a little bit of retargeting and I said, “I don’t want to spend the time to do it. I’ll just throw some money at it.” I mean, I’m now at a stage at Mixergy where’s there’s a little bit of money that I can use to go and do retargeting.

Rick: Yeah.

Andrew: Why should I figure it out if there’s someone out there who’s better at doing it? So now I’m getting it from being on this side of the table.

Rick: Yup. Yeah, and that’s the . . . that’s where the . . . and we’ll get to this a little bit more but that’s where the content marketing piece comes into play.

Andrew: So this is one of the things I want to talk to you about and I’ll tell you why. You guys are so good at content marketing. You’re on Moz a lot, right? You’ve been inactive and you have, I think, someone who’s basically on Moz for you. I forget her name. But you’re on Moz a lot.

Rick: Yeah.

Andrew: You’re on Inbound.org a lot.

Rick: Yeah.

Andrew: You guys are out there a lot in the marketing space.

Rick: Mm-hmm.

Andrew: This started early on. How do you start out in content marketing in a way that allows you to bring or have customers just come to you because they like your posts? Rick: Yeah, so it’s exactly what you were talking about with retargeting. You realize, “I want my face to be all over banners. I want to promote.” Maybe you didn’t want your face but you wanted to promote your service offering to people through retargeting. You’ve got the concept of retargeting but your time is obviously valuable. You’re not necessarily going to spend hours upon hours researching retargeting, how to make that work for you.

And so what we wanted our clients to do initially was when they Googled anything about comparison shopping engines, for our blog to come up with our content. And once they see our blog, once they see our expertise, it’s not a huge jump for them to say, “Okay, this shit is complicated. I would rather just pay these guys to execute.” And so I’ve heard the analogy before that instead of . . . even if you’re a great chef, if you show everybody the ingredients and you tell them the recipe, they’ll still oftentimes hire you to do the cooking for them because they don’t want to cook.

And so that’s what content marketing is. Initially, we were really afraid to reveal all of our secrets and we realized that even if we give away the special sauce of our managing these campaigns, the majority of smart business owners will realize that it’s not the best use of their time and they’ll hire us to execute.

Andrew: And it was . . . was it . . . it couldn’t have been just throw some blog posts out there. Even if they’re really good, you need to get people to pay attention.

Rick: Yeah.

Andrew: What did you do early on that got people to pay attention?

Rick: So early on there was no one talking about the comparison shopping engines and so content around PriceGrabber and Nextag and Shopping.com and Shopzilla, there was just no content. But there was . . . people were searching for that content. You could tell that there was search volume that just wasn’t being fulfilled.

And so we had a consistent effort where myself and especially, Tien, who was my roommate in UCLA – he’s one of the cofounders of the company – he kind of took over the blog, was consistently putting out one, just one post per week where we talked about the comparison shopping engines. And at that time in that niche, there wasn’t a lot of competition. So from an organic traffic perspective within the first six months, we were already getting traffic.

Andrew: I see. The woman who I was talking about, I just found her right now. Mary Weinstein.

Rick: Yes. Mary heads up our marketing team. She is awesome. Our marketing team is actually only three people. We have Mary, and John – who leads most of the webinars and partnerships, and then Hiram who’s our graphic designer. They’re a team of three. But, when we go out to conferences and talk to partners, there’s this perception that we have this huge marketing team. That’s a credit to what Mary and her team are doing…

Andrew: What Mary’s doing is she’s on Moz like she’s an employee of Moz. I know Moz well enough to understand that she’s a contributing writer, but…

Rick: Yeah.

Andrew: …that’s the way it comes across sometimes. Here’s a post, ‘Google Shopping Feed Costs and Pay Per Click Best Practices’…

Rick: Yeah.

Andrew: …from 2013.

Rick: Moz, Search Engine Land, Search Engine Watch, we want to be the expert when it comes to Google Shopping. It kind of morphed from comparison shopping into just Google Shopping. But, whether it was the comparison shopping engines, or Google Shopping, or paid search for retailers, we want to be the voice of that industry. It’s taken a consistent effort, but it’s paid off. That’s how we get all of our clients now – through inbound marketing.

Andrew: So, it’s Google Shopping where it used to be sites… I keep mentioning PriceGrabber. But, I do feel like they lost a lot of their power. Why did they lose so much power?

Rick: PriceGrabber or Google Shopping?

Andrew: PriceGrabber and all the other sites.

Rick: Yeah. They were awful at innovating. What happened is when I was working there they had just been purchased. Nextag got purchased. All of these comparison shopping engines, at one point they were hot, they were being purchased for $500 million, $600 million each. But a lot of them were purchased by private equity firms, so they became cash cows essentially.

They went from being super innovative. They created this very unique experience that helped to match products with shoppers’ intent. That just stopped. There hasn’t been any innovation in the space for about, like, six years. Most of them are kind of dying a slow death.

Shopping.com was lucky in that they were purchased by eBay and eBay has been able to kind of keep shopping.com going relatively strong. But, yeah, the industry as a whole just completely stopped innovating and they got taken over by channels like Google Shopping and Amazon, where the last six years all of the innovation in retail has come from Amazon and from Google. And, comparison shopping engines just were being treated like an ATM by the firms that owned them…

Andrew: I get that.

Rick: …realistically.

Andrew: All right. There you were. At the time you guys could do it all on your own while… Who was it who was doing content at first?

Rick: Tien.

Andrew: Tien.

Rick: We were all contributing, but Tien was like the main…

Andrew: What was your focus then if Tien was focusing…

Rick: Sales.

Andrew: …on content? Sales.

Rick: Sales, yeah.

Andrew: Calling up, doing what you did with that original jewelry company and saying this is our value prop, are you interested, we could get you set up.

Rick: Yeah. Selling potential clients. Selling Nii, who was at eBay. Selling Tien, who was my roommate from UCLA. Selling Will, who was from PriceGrabber…

Andrew: You mean selling them on quitting and also coming and joining full time, and also selling clients.

Rick: Yeah.

Andrew: What was… What’s one thing…

Rick: It was always about the vision of what we could become as a team of four.

Andrew: What’s one thing that you learned about doing sales when you were just doing cold calling yourself?

Rick: One thing that I learned, it used to be a lot easier to get people to pick up the phone.

Andrew: Ah, yes.

Rick: That has changed pretty dramatically over the last seven years. To get through gatekeepers and the amount of competition from a cold calling perspective is totally different now. If I tried to cold call pretty much anyone today who was important and was the decision maker it’s almost impossible. So, the…

Andrew: Because they have stricter gatekeepers, or because they’re just not using the phone anymore?

Rick: Both. To set up an appointment and to get on their radar is so much more difficult. The great thing about inbound marketing is that the clients come to you. The bad thing from a marketing perspective is that you’re training them to make that decision. So, they’re not open to the possibility of…

For your example, the retargeting, you probably wouldn’t be open to somebody just calling you out of the blue and selling you on retargeting. But, if you Google retargeting, you find a white paper, you find an agency that you like, you’ll reach out to them. Seven years ago someone might’ve been able to call you about retargeting, even though it didn’t exist then, and you would’ve picked up your phone. Nowadays, to get ahold of Andrew Warner is going to be almost impossible.

Andrew: If the phone rings you feel like something must be wrong with either…

Rick: Yeah.

Andrew: …the phone – why is it ringing – or…

Rick: Yeah, what is this noise…

Andrew: …the person.

Rick: …from this device? Like, I call people, but I don’t receive calls if they’re unsolicited.

Andrew: I was looking on my calendar to see the name of the guy who helped me. He was fantastic. I just can’t think of his name right now. It’ll come to me.

Rick: For retargeting?

Andrew: Yeah. Jonny. I just can’t find Jonny’s last name. But, I was just interested, and he said hey, do you want to talk about this. I said hell yeah. It was on Twitter. That’s how he found me, and I immediately scheduled a call with him.

Rick: Okay. Yeah, that’s Endo [sp] marketing.

Andrew: So that’s the difference and I could see that. If he called me out of the blue, I wouldn’t be interested. If he tweeted at me and said, “Hey, are you interested?” Of course I’m jumping in.

Rick: Yeah. He was listening. He was listening for what you said initially.

Andrew: Yes.

Rick: And so it’s a different paradigm.

Andrew: Let me do a quick plug here. Frankly Rick, I don’t think I did that top spot, that top commercial very well and I want to do it justice. It’s a new sponsor. As you said earlier, Scott Walker was my sponsor for the longest time. Clay emailed me and said, “You know what? I know you have a really effective sales page, landing page. Would you promote it?” So I’m up for trying it. Here’s a better promotion, Rick. You tell me if this makes more sense.

Rick: Will do.

Andrew: The problem that I had at Mixergy a while back was people would hit my site and then they would take off. If they interview they would hit was fantastic, they would love me forever. If they downloaded it and would listen to it, they would love me forever. I hope so. But if they saw, “You know what? This is an interview with someone who’s B2B. I’m not interested.” They might take off and never reconsider coming back to Mixergy.

So I needed a way to stay in touch with them. And of course the best way is getting an email address. So I experimented. People who have been fans for a long time, you included Rick, might remember that I was trying different ways of capturing email addresses. And boy, it was tough. I tried offering this and that. And I tried doing a landing page on the home page. It took me a lot of years of experimenting. One thing that people might have heard over the years that worked for me was putting a lock on the screen. Trust me. I will not spam you. This is safe. So little incremental changes like that.

Then I hit on a big change that really worked and I created this squeeze page essentially that tells people what Mixergy is about and invite them to put their email address in. That works like gang busters. About one out of five, maybe one out of four, put their email address in. It works terrific. So when Clay Collins said, “Will you create a page for us on Lead Pages?” I said, “Yeah. Why don’t you try this one.” And so that’s what I’m offering. This page that took forever to work right that now allows me to grow my mailing list and my connections consistently, powerfully is now on Lead Pages.

And I’ll give you the direct URL if you guys out there want to try it. It’s Andrewswelcomegate.com. It’ll be completely powered by Lead Pages. You can buy it for a buck. You can try it out for a few weeks and if it works for you, terrific. And if it doesn’t you can try any number of other squeeze pages, lead pages, capture pages from Leadpages.net. All for like a buck. For a buck. It’s an experiment. I’m telling you it’s available right now while you guys are listening to me. If you wait too long, I might decide to pull it out.

What I’m going to do to be open with you is watch my conversions. If having other people out there with a similar page to mine reduces my conversions, I’ll say, “Clay, can you pull it?” If it doesn’t then we’ll keep it going. But I’m not sure. It’s an experiment. So if you’re interested, if you want to increase your conversions, get more people to stick around by capturing more email addresses, try out my page. You can completely customize it and it’s available to you right now on Andrewswelcomegate.com. Andrewswelcomegate.com. A special URL to make sure that you go directly to the thing I’m talking about.

Go sign up and good luck for you. Not good luck, congratulations to you for getting it. That’s a better promotion, right? I think the one I did at the top was a little confusing.

Rick: Do you practice those?

Andrew: No, I should probably.

Rick: I feel like you practice them. You tell this whole story around the pitch, and I feel like you present it in a much more compelling way than a normal spot.

Andrew: It was kind of verbal diarrhea at the top. There were all these different thoughts that were in my head. First it worked for me. Second Clay Collins. Third lead pages. Like too many things and I don’t think it made sense. And so afterwards I said, “Pull it back. What’s the best way to explain something? With an example, with a story. What’s the best story for promoting something and selling? A story that shows the problem and shows how I got the solution and says if you want the solution, here’s where you go.” So I just allowed that formula to run through me.

Rick: So the entire time I was talking you were thinking about redoing the Clay Collins spot again.

Andrew: No, it used to be, frankly to be honest with you Rick, in the past when I goofed all I would think about is that I goofed and I would sweat it out and think, “I can edit.” Now I allow the thought, like very meditative. I allow the thought to enter my mind. Say, “Trust that you can fix it later. And if not in this interview, then the next or whatever.” Just trust and then I let it go.

Rick: Awesome.

Andrew: So that’s where I am right now.

Rick: Well, I thought you did an excellent job, Andrew.

Andrew: Thank you. It’s all about meditation sometimes. For that kind of focus.

Rick: Do you meditate every day?

Andrew: I don’t meditate every day, but most days I do this focus meditation that really helps me. That allows me to just focus on what I want and let go of all those stray thoughts that distract me. I call it the true mind meditation. It really works.

Rick: I’m reading the book called The Charisma Myth and there’s like three components to charisma according to the author. Which is presence, power, and warmth. And for presence they talk about a lot of techniques around just being in the moment, resetting yourself to stay in the moment. One of them that they talk about is to either think about your toes or to think about your eyelids or your eyes. And a lot of people will carry tension in their eyes when they’re somewhere else.

So when they’re thinking about a future event or a past event that’s causing them tension. And when you refocus your energy on your eyes and you relax your eyes, it kind of puts you back in the moment. So I’ve been doing that for the last two weeks and I’ve found it to be pretty helpful.

Andrew: You know, that’s an important point that you’re right, when people are, when I feel charisma from them, when I feel a presence from them it’s because they’re minds are presently here. But there’s so many things for me to think about. Like am I running late today? How do I make sure that I live up to the obligation that I had at the top of the interview? Am I interesting? All that stuff. Did I wear this shirt too many interviews in a row. All that stuff takes you away from the conversation. You would feel it. The audience would feel it. I wouldn’t be as helpful.

Rick: No, I think that’s a big part of your success is just staying present. If you’re doing the interview and you’re looking at your cards the entire time. And you’re not focused on that person, the audience in going to perceive that. In the book they use the example of Bill Clinton. There’s like 150 quotes online where every day normal people have said, “He always makes me feel like I’m the only person in the room.”

So that’s not about what he’s saying. That’s not about power. It’s just him being present when he was talking with people. So it’s a big part of charisma that is relatively easy to control and a lot of people just don’t have the focus to do that because they’re so insecure with their own thoughts that they can’t just stay in that moment and focus on that person.

Andrew: I don’t think people admit it to themselves. I think as you are saying right now, they’re so insecure. People are listening and saying, “Oh, yeah. That’s other people. I don’t have any insecurities at all.”

Rick: No, that’s not me at all. I would never do that.

Andrew: But we all do. I mean it’s part of what goes on in our heads.

Rick: Well, thank you for staying present in my interview. I appreciate that.

Andrew: I’m glad that you asked about that. I’m really proud that I’m able to do that and it’s interesting to see that…In the past I might have gotten distracted by all those thoughts. All right. So here we are now. The business is finally running.

Rick: Yeah.

Andrew: You’re starting to hire people because you’re doing well. Your formula works. People are getting to know you by reading posts about you. You’re getting to be common. Your company’s becoming a thought leader in the space. Now you’re starting to hire people. Can you give me an example of a problem of hiring people. Because I understand that there are many people in the audience who are saying, “Dude, you hire people, they’re experts. Once you do that, life is easy. That’s not the hard part.” But it’s not. It’s not easy. What is hard about it?

Rick: I think the hardest part about hiring is to find the fit for your company. Somebody’s intelligence can blow you away. They can be charismatic. They can have a skill set that is impressive. But to know exactly who you’re trying to hire and to really have an idea of that ideal candidate profile before you’ve even met that person. That’s what I’ve learned throughout the years is it’s not just about hiring talent. It’s about hiring the person who wants to be in that position. That you feel confident about them succeeding in that position. For instance, we just hired an office manager. So it’s an executive assistant slash office manager. I think that there’s a lot of people who would be amazing at that position, but they have to want to be in that position.

Andrew: As opposed to saying, “This is a stepping stone towards something better. Why am I even being an office manager?”

Rick: Exactly. So our retail search manager position will start somewhere in the mid 30’s salary wise. And there’s people who will come out of college who will see that position and say, “I love this company. I really want to work for them. Hell yes, I’ll take a job in the mid 30’s in hopes that I can build my career at this company.” There’s also people who will say, “I’ll take the job.

Realistically I should be starting at a much higher salary and a much more challenging position. But this is a stepping stone to get to where I want to go.” So both people are smart. Both people come across an impressive in the interview. And it’s your job as the manager, as the hiring manager, to figure out what their real motives are and whether or not they truly buy into your vision and want to work for your company…

Andrew: So how do you do that?

Rick: …or they just want to have a resume builder. I think that for me that comes from their authenticity. I feel like I’m a really good judge of character and in a 45 minute interview I can assess how authentic someone’s motivation is. Those are the types of question that I’ll try to ask them. I try to put myself in their position. Be empathetic with their major, where they’re coming from, how excited they seem by the future of our company and project whether or not I think they’re being authentic.

And so if you can tell that someone’s being authentic and they truly want to be a part of your company, they’ll come in and they’ll perform and they’ll start a career at your company because they want to be there. If you hire someone who’s not authentic, who kind of fools you in that interview, you’re lucky to keep them at the company for a year. And you can tell in their actions day in and day out that that was kind of always the plan. And so I think authenticity and questions around authenticity, trying to truly understand their motivations is crucial during that interview process to figure out the right fit.

Andrew: We talked about the shift to Google Shopping.

Rick: Yeah.

Andrew: Right? That’s where most of the energy is right now. All the energy? Is that where…

Rick: No, it’s not all the energy. The main initiatives for the company are Google Shopping which is also called Google Product Listing Ads, managing traditional text ads. So page search for retailers. And we are just about to officially launch our Amazon Marketplace line of business to consult sellers on the Amazon Marketplace to help grow their sells through Amazon. Those are the three main lines of business.

Andrew: And as you were making those changes and more of your business was in Google Shopping, Google made a change.

Rick: Yeah.

Andrew: What do you do now as a team when you can’t handle it all by yourself to adjust to Google’s adjustment?

Rick: So behind closed doors I freaked out. With the leadership team I tried to project an image of positivity. Of being a strong leader in that time. So what happened was most of our clients, the main channel that we manage for them was Google Shopping which was free. And Google announced to the entire world, this was about two years ago, that it was going to turn into a paid program. Our initial reaction was, “Our clients are paying us a flat fee. This traffic used to be free. They’re now having to pay for this traffic. It’s going to kill or hurt our value proposition.”

The client’s initial reaction was, “This traffic used to be free. Google is now charging me for it. They are trying to put me out of business.” I didn’t know if I should still sell my products on this channel. And on top of that they were going to put the Google Shopping listings or the management of those listings under the Google AdWords login. Which meant that every paid search agency on the planet was now going to start competing for that business. So previously we were just competing with about three or four companies that were within the CSE sphere. And now once Google Shopping was put under the Google AdWords login, we were now competing with hundreds of companies. And so not only…

Andrew: So a lot of your current clients suddenly saw their costs of doing business there go up and you’re getting more competition. So you freak out, but you do it behind closed doors so that the people that work for you don’t know it. And then you come up with a plan.

Rick: Yeah. It was something that we as a good business owner you should try to project out in the future and least once or twice a year do an exercise where you go through potential scenarios that might happen. This was something that we were somewhat prepared for happening. It happened a little bit faster than we were anticipating. But once it happened we realized that the only way we could truly compete was content.

So these paid search agencies if we go to a conference, all of our competitors might spend five hundred thousand dollars as being the platinum sponsor for the conference and they were going to promote the hell out of the fact that they were the best at Google Shopping. That wasn’t the truth. The truth was that our background in CSE’s and data fees and managing individual products was actually the skill set that was much better for Google Shopping. But we needed the message to get out there to our clients and to potential clients that we were the best agency to manage the channel. So we did that through content.

We immediately created the guide for the transition to paid Google Shopping that was 80 pages long. The entire team contributed to that guide. There was nothing else like it within the first three months of that transition. We did a webinar on the transition. We actually did three. So the content allowed us to position ourselves as the thought leaders in that space. Which in turn actually exposed us to a much larger audience. So it’s something that initially we feared. We went for it in terms of the content. Our messaging to our clients and I think today out of the clients where we’re in the AdWords account, we’re managing Google Shopping for about 95 percent of them. So we essentially won that battle for getting access to those accounts.

Andrew: Wait, you’re saying that in addition to the work you were doing for them before, now you’re also doing AdWords for 95% of your clients.

Rick: Yeah. It’s kind of complicated, but what happened is if you had an agency managing your text ads within Google AdWords. That used to be Page Searcher AdWords but Google said we’re going to put the shopping campaigns within the Google AdWords login. And so now you had . . . you may have been working with a Page Search agency and us to manage your feeds for Google shopping. And now Google’s put it kind of right in the middle and both of our agencies are telling you we’re the better option to manage this channel for you. And so, it was crucial for us, with our existing clients, to win the largest . . .

Andrew: And you’re saying you won 95% of them?

Rick: Yeah.

Andrew: Really?

Rick: Yeah, we managed 95% . . . Of our existing clients, we managed P.O.A.s for 95% [??].

Andrew: And so you lost some clients though?

Rick: No, we actually, we weren’t managing Google Shopping for everybody. And so we were managing comparison shopping engines. If they’re over here, text ads are over here, Google Shopping is in the middle. And so we actually gained a much larger percentage than we had before because of our content.


Andrew: And so because you decided that you were going to do webinars to teach your people what this change meant and you knew that there was a confusing time, you helped persuade them to stick around and give you more business?

Rick: Yeah.

Andrew: And because you created this guide, and jumped in before other people did, you won more business.

Rick: Yeah and the reality is that we were better positioned to win their business but we had to tell that story in a way that our clients believed and that’s what the content did for us. And so it continues to do that for us. We established ourselves as the thought leaders for Google Shopping. It actually, so much so, that we got Google to . . . we finally got on their radar after 7 years and became an official . . . we’re 1 of 10 Google Shopping partners.

And I looked at that list and I’m pretty sure there aren’t any other ones that were boot strapped and they all came from investment. They’re all much larger companies. And so the only way that was possible was through our content and we pushed extremely hard in that direction and that’s why we’re looked at as thought leaders in the space.

Andrew: So, this is the second time that I’ve heard people do that. The last time was Nathan Latka of Heyo where his whole business was turned around when Facebook decided that they weren’t going to feature a company’s page but instead a timeline.

Rick: Yeah.

Andrew: And he was in the business of creating Facebook pages that were going to get featured. Suddenly his whole business was turning around and what he did was, he said, ‘I might be confused by what’s going on but my customers and other peoples’ customers are even more confused. I’m going to decide that I will teach everyone how to make this work.’

Rick: Yeah.

Andrew: And by teaching everyone, he helped secure his current customers and bring in new customers. So, all right, when there’s confusion like this, we have to remember: be the leaders. Lead other people out through their confusion because they’re more confused than we are.

Rick: Yeah. Make order out of that chaos. Have confidence in your ability to learn this new process faster than the rest of the market. And, even if you don’t know it today, you have confidence that within the next month, two weeks, four weeks, exactly what you’re doing with your test with Clay. You’re not saying that, you know, absolutely this is the best way to increase my conversions but, you’re putting the landing page out there.

You’re showing the results of that test and, if that is successful, then of course people are going to want to follow that. And so, content is the same way. You don’t have to always have to know exactly what the outcome is going to be as long as you’re transparent, you have confidence in your ability to learn faster than the rest of the market. That’s how you become a thought leader.

Andrew: All right and the fact that now you had a team of people meant that you can create . . . other people did the webinars and did the selling for you and explaining for you. Other people helped create the guide. All right, there was another time when you had a big issue and that was when a major piece of software suddenly increased its prices. What was the software and what happened?

Rick: Yes, so, I don’t have to name the company?

Andrew: No, don’t name the company then. Give me a sense of what they do.

Rick: Okay. So, they provided software for the data feeds. So, when we initially started the company, we needed to have the ability to take one of our retailers’ feeds and send it out to these ten to twelve different channels.

Andrew: Okay.

Rick: And there was no easy way to do that through Excel. It really necessitated that you use some sort of software to take that feed and project it out. We had a deal with this particular partner, who we were completely reliant on for the first two, three years of the business. And I think it was the first two years of the business. And we were paying them $1800 a month, a flat fee. We started sending out, at that time I think we had 70 clients, and so it was kind of a model that they weren’t accustomed to.

Initially, they were excited about the partnership but since it was a flat fee, we kept sending out clients to them. And I’ll be honest, it wasn’t the most fair model. We were kind of taking advantage of the [??]. So, they sent out . . . they got a new management team – a couple of guys from Wall Street that didn’t have e-Commerce experience. They wanted to meet with us in person. We were all flattered that they wanted to meet with us. And it was going to be . . . we were going to take the partnership to the next level. And they met with myself and Nee [SP], one of the co-founders of the company, and sat down and basically told us that our fees for three months were going to increase from $18,000 a month to $30,000 a month.

And that was probably the biggest OSHA moment in the history of the company. It wasn’t something that you could prepare for. It came completely out of left field. And so that day, I think we were, you know, all of the founders, we sat down, we talked about it. The four of us were kind of in shock and the reaction to it on . . . That was on a Friday. On Saturday Nii and Tien, Tien was my roommate from UCLA. Nii used to work at eBay. Started working on a program to simulate with this particular platform what’s doing. Within two days, they worked on it non-stop for two days. Within two days we were able to replicate enough of what that software was doing where we had a long-term option alongside of them.

So we still kind of had a staggering program to get all of our clients’ feeds onto our own platform, and obviously we’ve improved it dramatically from where it was after the first 48 hours, but it forced us to come up with a new game plan and we did. We didn’t panic. We didn’t over respond to it. We didn’t over react to it, and I’m pretty sure the partner was shocked that we were able to maintain our business. They kind of thought it would put us out of business, and now our company is larger than theirs. It feels pretty damn good.

Andrew: [laughs] And so you now have this software in-house . . .

Rick: Yep.

Andrew: . . . that does what their software used to do. I know that every consulting company wants to be in the software business, it feels like.

Rick: Yeah.

Andrew: Did you guys take a deeper step into software?

Rick: Yeah, we did. So the software we use internally, that platform. It’s just internal. It serves a very specific purpose. It’s not client facing. We don’t try to sell the platform individually. And so a lot of service companies go through, especially when you’re an entrepreneur, you see that the multipliers on a software or a platform company are usually 8 to 10X revenue whereas for a service company you’re lucky if you get 1 to 2X revenue. And so there’s this pipe dream of, “Oh, we’ll just build a platform and then it’s going to make our multiplier 8 to 10X revenue.”

Andrew: Right.

Rick: And so we actually invested about two and a half years. We hired a developer. We tried to build a platform that would allow to take our clients’ products and integrate them seamlessly onto the Amazon marketplace. And there were only two more technologies that were doing it really well. We saw there a need for us within the market for us to tackle that. It was an extremely painful process. We put the developer in a really difficult position where we were in over our heads. We weren’t a technology company. We didn’t know what we were trying to actually build. We had no concept that the teams that we were competing with had millions of dollars in investment, teams of 16 developers each with our going against with our one developer. We didn’t even have a product manager. We were really, really naive.

And so we spent about $250,000 total of investment, and we had to make the decision to really focus on what we do well which is services and scrap the entire project. We let go of the developer. And since then the company’s been so much better for it, for us to kind of get rid of this delusion, that somehow we were going to build this amazing platform with our one developer.

Andrew: It was a nice shot, but I guess what you’re saying.

Rick: Yeah.

Andrew: So now today you’re services only, no more software.

Rick: Yep, we’re services only and even within services I talk to a lot of entrepreneurs about having the discipline to stay focused. And so we could offer realistically 12, 14, 16 different services, and in the short term that would be better for our revenue. We could charge a lot more per client. But to become a great company we want to do 10 million in revenue the next two years and become a $20-30 million in revenue company.

I think you really have to have the discipline to stay focused. And so we weren’t focused when we were trying to build the technology component. There was a short stint where we tried to take on non-retail business and worked with like lead generation companies. And we realized we truly get to where we want to go, we can’t try to be all these different things to all these different potential clients. We have to have the discipline to remain focused and own these three branches of business that we’re going to be the best at.

Andrew: You know, I have a . . . I use similar web to check out where people are getting traffic just to get a sense of what’s going on. In your case, a lot of it just makes sense. You’re getting a lot of your traffic from Feedly because people are reading your blog posts, SearchEngineWatch, SearchEngineLand, Moz. All that stuff makes sense, except for Marqueto which I can’t see as much because that’s your marketing platform, right?

Rick: Right.

Andrew: That’s what you use to email your audience. etc.

Rick: Yep.

Andrew: Why do you choose Marqueto?

Rick: So Marqueto has been huge for us. We initially started with Hubspot. I think one of the keys to our success as an agency is that we use technology to make our team a lot more efficient. I’m 32. Like I said, I started the company when I was 25. The oldest member of the team is 34. And everyone understands the potential benefits of technology and using that technology. When you talked about Mary, it seems like Mary is everywhere. And I talked about our marketing team. The perception is that we have a much larger marketing team because of Marqueto. And we’re able to…

Andrew: What does Marqueto do? I thought Marqueto…Actually what does Marqueto do?

Rick: So Marqueto is for creating landing pages, emailing your clients, lead scoring, and lead generation. And so it allows our marketing team to create landing pages on the fly. We get emails that go directly into our Marqueto system. You can then segment the email list and have like drip campaigns for each of the email lists. You’re familiar with Hubspot right?

Andrew: Yep.

Rick: Okay. So Hubspot and Marqueto are competitors.

Andrew: But Hubspot is much more hosting. They do CRM, right? It’s a much bigger package.

Rick: Yeah. I would describe it as more small business. It’s designed for people who don’t have a blog yet. They want to host their blog on Hubspot. They give you this package to learn endell [sp] marketing. We had already been doing endell marketing and we actually started with Hubspot. This was five years ago so it’s a lot different. And potentially their technology has advanced dramatically. I know Dharmesh is a genius so it has and they’ve been really successful.

But we felt like Marqueto had more advanced functionality in terms of landing page reation and email segmentation. So that’s the one that we chose. But regardless of whether it’s Hubspot or Marqueto, that marketing automation component, that’s where you can take a team of one to two people and have it feel like a marketing organization.

Andrew: Why? I understand landing pages. It means that they don’t have to wait for a developer to create a landing page, etc. But what else does Marqueto do that allows you guys to be bigger than you really are?

Rick: It allows us to segment out emails. It allows us to grade the leads that come through. It allows us to see the activity for all leads that come through.

Andrew: And by activity you mean you can tell I’ve been looking at your site a lot more than someone else. So I might be a hotter lead and more worth at your team’s energy.

Rick: Yeah. And we could have a drop down for one of our lead fields that when you fill out a form it says, “Andrew Warner are you a retailer, consultant?” If you’re a retailer, we automatically bump up your score by 50 points. If you’re a consultant, you don’t get any points. And then if you’re a retailer, it’ll have a field for your advertising budget. If you put five to ten thousand dollars a month, you’ll get a score of 20. If you put above 50 thousand dollars a month, you’ll get a score of 30. And so the leads scoring is being sent to our sales team to say, “These are the opportunities that are most qualified for our service and are most engaged, they have the most activity with our brand. We need to start a conversation with them and figure out why they’re looking at all this content.”

Andrew: You guys are also big with Magento.

Rick: Yeah. So Magento is where about 25 percent of our clients. We have 230 clients. I would say about a quarter of them are on Magento. So we developed the ability to through a module or Magento calls them extensions to take one of our client’s Magento feeds and send it directly to our platform. So that was just a way for us to generate more leads directly through the Magento marketplace.

Andrew: And then are they also promoting you guys because you have this tool?

Rick: Yeah. On the Magento marketplace, if you develop an extension, you’ll get promoted just by default. So when people search for Google shopping on the Magento marketplace, we’ll be one of the first extensions that show’s up.

Andrew: Alright. This is a little off topic too, but what is the PLA guide?

Rick: The PLA guide is the Google Shopping Guide I was talking about. Google Shopping…

Andrew: That seems like a really big source of traffic for you. You guys are also apparently according to What Runs Where, you guys even buy ads for it.

Rick: We do. We promote it pretty heavily. There is no other piece of content on the internet that comes close to the amount of detail that we go into about [??] the PLA Guide. Like I said, it goes back to what I said in the beginning. We gave away all of our secrets. Like with our content, we stopped being afraid of what people would do with it.

And we understand that yes, there’s going to be a percentage of the market that they take this guide and they manage their campaigns in house and they never hire us. But there will be a lot of clients and decision makers that say, “Okay, this is way too complicated. I don’t want to read 80 pages, I’m just going to hire you guys.

Andrew: Like some people if they want to check out the PLA guide, I guess just do a Google search for the PLA guide The Product Listing Ads guide.

Rick: Yep.

Andrew: Right?.

Rick: Yep, yeah. I’ll send you the links if you go to, it’s just CVS Drives you/product listing ads guide.

Andrew: Okay. Someone put it in the comments please if the audience is asking for it.

Rick: All right. You know what there one more other thing. I wasn’t sure if I should even talk about this.

Andrew: Yeah.

Rick: Except that, You told, I think you did the pre-interview with April and you told April about it.

Andrew: Yeah.

Rick: Your mother was going through something.

Andrew: Yeah.

Rick: That’s the [??].

Andrew: How did you take it? What was she going through?

Rick: So at the time I talked to April, This won’t come as a surprise to your audience but it takes about six months to get on your interview schedule. And so I talked to April earlier this year. We’re now in July, At that time my mom was living with me. She had stage 4 brain cancer, living with my wife and I. And just having her in the house and dealing with her health deteriorating. Was the most difficult thing that I had gone in, Or gone through, you know, throughout the course of CPCStrategy and realistically my life.

Andrew: Yeah.

Rick: I’ve never dealt with anything like that, She actually passed away, About a month ago and it escalated from her being in my house, Her, It being a challenge just to maintain my focus at work and kind of come home to an environment that was much more stressful, And when she passed away it was obviously, you know I thought I was prepared for it but, It was another level of stress anxiety, Grief that i had never experienced before.

Andrew: Why did you continue to work at that time?

Rick: So I actually didn’t. The last week before she passed away. I took that week off of work and the week after she passed away I didn’t work I just stayed with wife during that time and my sister and my family. And so, Yeah I took off 2 weeks total and honestly it was really helpful for me when I went back to work. I know that a lot of companies talk about you know being a family and the atmosphere, Like it’s a family. And there are some differences there, It’s kind of more like a team than a family, You don’t, You don’t fire members of your family if there not performing well. But I genuinely love the people that I work with,

There was so much support from them and the routine of work and being around my friends and my co-workers. It helped me a lot, To kind of deal with that grief and so the time that I spent at home. Was much more difficult for me than when I went back to work and I got into that routine and that support was there actually my entire company came to my mom’s funeral.

Rick: Really?

Andrew: Yeah.

Rick: Which was a couple of weeks back. And yeah, honestly without my wife without my company, I think it would have been a lot more challenging for me to deal with it. I’m still grieving obviously, But I know everything is going to be okay. I know that I’m completely fulfilled in life, By leading this team of people and that’s helped me to, To have the strength to walk back into the office and hold my head up high and tell them that I’m going to be okay and the companies going to be okay and yea it’s been a very challenging but fulfilling process and yeah, That’s where it’s at.

Andrew: Well that’s good to hear. Usually I think on TV your, Your told that, If you continue to work past that, Then it means that your cold and you just care about the money of business, But there so much more to business than just the money that you get from it, There is as you said.

Rick: Yeah.

Andrew: this feeling of closeness with the team.

Rick: Yeah.

Andrew: I assumed that you were working because, I think we had an interview scheduled for the day before or after she passed and, you got on and you said look, Andrew, I think, I’ll tell you what’s going on it’s just not a good time and.

Rick: Yeah.

Andrew: Of course I understood completely. You know what, I should, I kind of feel like I should end it here but there are a couple of things that I want to ask you about.

Rick: Okay.

Andrew: But you and April talked about that are Important.

Rick: Yeah.

Andrew: You’re reading, You’re really into Robert Green? Right?

Rick: Yep.

Andrew: I understand mastery, You probably finished reading that book by now right?

Rick: Yes.

Andrew: Fantastic book. What did you think about it?

Rick: I thought it was spectacular, It , It , It…, I don’t know what it is about his writing style but he so freaking inspirational and 50th blog, I thought was a lot more cut throat , You know a lot of the books that I read are about the psychology of a team and I would say that there. A lot of it is based on the emotional investment that team members make and it’s kind of like touchy feel y. 50th law was like the complete opposite of that.

Andrew: Really?

Rick: It was every person. Is out for their best interests. They will always do what benefits them most individually. I didn’t actually agree with everything in the book, but I found it to be really inspirational. I read that book.

Every book that he’s come out with afterwards I’ve read. ‘Mastery’ was his most recent one. It goes along the lines of a lot of the stuff that I can attribute our business success to which is you put in the time to be great at something and you keep doing it.

Andrew: Yeah.

Rick: And, you stay focused on it and you have the discipline to stay focused on it and not chase the shiny things that are all around you. By doing that you become great.

If you had tried to take on podcasting, and blogging, and you’re writing eBooks, and you’re doing all of that in addition to trying to be the best interviewer in the world, you probably wouldn’t have become one of the best interviewers in the world.

That focus, I think, has been critical for us as a business and for me individually to not try to have eight different businesses going at once. I’ve seen a lot of entrepreneurs who do that, and I think if you want to develop that mastery you have to focus on it and you have to stay disciplined. That’s what the book’s about.

Andrew: I love that about it. One of the reasons why I think his books are so inspiring and so captivating is he doesn’t use the same old examples. He’s not going to rehash the Apple example for the five billionth time.

Rick: Yeah.

Andrew: Because you could say look, Apple focuses on technology. They don’t get into making TV shows. They don’t get into making toasters, unlike Sony. But, he doesn’t.

Rick: Yeah.

Andrew: He pulls in examples from a thousand years ago…

Rick: Yeah.

Andrew: …and then again one from a hundred years ago, and so on.

Rick: Like, we get it, Steve Jobs is The Man. I don’t need to…

Andrew: Yeah, right, I don’t…

Rick: …five thousandth…

Andrew: It means that you really haven’t done any research if that’s as far as you can get…

Rick: Yeah.

Andrew: …to show me, to make your point. We get a lot of authors who do that, and it’s a real challenge. And, ‘The 50th Law,’ I was thinking of getting on audiobook. Robert Greene reads it himself. Now you’ve convinced me I should get it. Here’s the third…

Rick: It’s like it’s cut throat, but I think it helps you to understand basic human psychology. I found it to be ridiculously inspirational, so I highly recommend that one. Also, I think that it was listed on there as a very short read called ‘Flinch’ by…

Andrew: Julien Smith.

Rick: Yeah, by Julien Smith who wrote “Trust Agents” with Chris Brogan. I think that one, you can read that in literally, like, two hours. It’s on…

Andrew: It’s a freebie. It’s 133 easy pages.

Rick: Yeah. I think you can get it on Kindle for free. That’s a great one for just kind of breaking out of your comfort zone.

He gives some examples in there about going into the kitchen of your house with roommates, or your wife, or kids, and dropping a glass on the floor, and seeing the reaction of everyone, and understanding that everything’s going to be fine, taking a cold shower, just kind of getting out of this comfort zone. We place a lot of, like, artificial barriers on ourselves.

I found that one to be really inspirational. I’ve recommended it to a few people. Then, a management book…

Andrew: Oh yeah.

Rick: …that I think is really strong, “The Charisma Myth,” which I talked to you about. I think everyone could stand to learn how they could improve their charisma and work on it. The point of the book is that it’s not something you’re just born with. There’s a pretty scientific method of improving your charisma.

Then, there’s a book by, I think it’s Adam Grant – “Give and Take: The Revolutionary Approach to Success.” The basic premise is that there are givers, matchers, and takers. It’s all about your energy. Some people give off a lot of energy. A lot of people will just match energy when they perceive that this person could help them. They’ll put a lot of energy into that conversation. They’ll be very present. But, when they perceive someone is lower than them they won’t do it.

Then, takers are the people that are really all about themselves. They’re very selfish. A lot of salespeople are actually takers, and that’s what makes them great at what they do.

I’ll try not to ruin it, but most organizations the top, the CEOs, are givers, and the bottom of the organization are givers. Most of the people in between are matchers.

The point of the book is to try to identify those different personality types and get the groups to work together. Because the givers oftentimes are not calling attention to themselves. They’re not trying to get credit. So, those are the people who get fired a lot of the times from organizations when they’re actually producing at a much higher level. They’re just not drawing attention to themselves.

Andrew: What’s the name of the book? I want to find it now.

Rick: “Give and Take:…

Andrew: “Give and Take.”

Rick: …A Revolutionary Approach to Success.” I think that’s what it’s called. I think the author’s name is Adam Grant.

Andrew: There, I see it now. Oh. I think I bought that on Kindle and for some reason haven’t gotten a chance to read it yet. All right. I will…

Rick: Yeah. I so feel your pain on that. My cue is, like,…

Andrew: Yeah.

Rick: …six books that I still need to read.

Andrew: Okay. There you go…

Rick: …[??]…

Andrew: …I just added it again…

Rick: …[??]…

Andrew: You know, I should have it. I just sent myself a note.

Speaking of notes, I found Jonny’s name. It’s Jonny Chen, J-O-N-N-Y Chen, who helped me with retargeting. Just like one quick phone call and he showed me what to do. But, I’d like him to do it, too…

Rick: That’s awesome…

Andrew: …to do it for me instead.

Rick: That’s awesome. Good job, Jonny Chen.

Andrew: Good job, Jonny Chen.

And, the website, for anyone who wants to follow up with Rick, is cpcstrategy.com, cpcstrategy.com. Thank you for doing this interview, Rick.

Rick: Yeah, thank you. It was an honor. I appreciate it. Hopefully…

Andrew: You’re staying late. You’re doing this specifically from home, because at work there are a lot of people who are using the Internet and a lot of bandwidth issues when they were working. You said Andrew, I will do it after hours, I will do it in a place where I have a high bandwidth, and where I can focus and where it’s quiet. That’s the other issue. There were a lot of people in the office all the time.

Rick: Yeah.

Andrew: So, you did it at home. It’s now almost 7:00 p.m., and I appreciate you staying late to do this.

Rick: Yeah. I appreciate the same from you. And, hopefully, when we get to ten million in two years we can do another interview.

Andrew: Oh, I’d love it, yes. That’s a commitment. Let’s do that.

Rick: All right. Well, I appreciate it.

Andrew: Thank you. Thank you all for being a part of it. Bye everyone.

Rick: Thank you.

14 thoughts on “What to do when a business gets too big for a DIY founder – with Rick Backus

  1. Reza K says:

    Andrew, the link andrewswelcomegate.com does not work…. am I misspelling it?

  2. @RK_algox:disqus @markharrison04:disqus Thanks for letting us know the link doesn’t work. We are working on fixing it.

  3. The link is working now: http://www.andrewswelcomegate.com Thanks again guys!

  4. Clay Collins says:

    Hi! Sorry about that, we’ve resolved the issue and the link is now up here: andrewswelcomegate.com

  5. Clay Collins says:

    Sorry about this! The link is now working here: http://andrewswelcomegate.com

  6. Clay Collins says:

    Sorry about this! The link is now working here. Our bad :http://andrewswelcomegate.com

  7. Berry Schwartz says:

    Rick you sound like a really great guy. Amazing that you just walked off that elevator and demanded an interview with pricegrabber. Love that!

  8. Testing the Andrew’s welcome gate! Cheers.

  9. Brandi Young says:

    HI Rick,
    I just happened to have listened to your interview on the
    12th anniversary of my own mom dying from stage 4 cancer. I was 27.
    You and your family are in my thoughts.

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