Moz’s Accidental Journey to $40m

A Conversation with Rand Fishkin: His Entrepreneurial Adventure and the Keys to Marketing Success.

This post was originally published on Frontcourt.

Rand Fishkin is one of the most well-known and respected online marketers on the planet. He’s the founder of the hugely popular software company Moz, which he’s guided from zero to more than $40m in annual revenue.

If you work in the online marketing space, you’ve heard of Rand. You’ve seen his content, read his books, and maybe even followed him over to Whiteboard Friday.

What you may not know, though, is that all this success was never the plan. According to Rand himself, the whole journey — all the way up to $40 million — has been somewhat of an accident. I connected with him recently to hear the details.

This is the Moz story you never knew.

The makings of an accidental entrepreneur

“I have a tough time describing myself. I guess I’m technically an accidental entrepreneur.” — Rand Fishkin

Prefer to listen to this interview? Hit play below:

The classic startup story begins with the founders having a great idea and then building it. It’s all very intentional and well planned, which makes for a great story years down the line. But what happens when the story begins accidentally? When the founders set out not to revolutionize an industry, but to drop out of college?

This is where the Moz journey begins: back in 2001, when Rand left college with only two classes left to complete. Why? To work with his mom, Gillian, on a business she’d been operating on her own since 1981. Outlines West provided marketing services and website development for small businesses in their hometown of Seattle, and Rand was a contractor of sorts, building Flash sites for local dentists, banks, and retail stores. The opportunity for growth was there, but it didn’t all go to plan, as Rand explains on the Moz blog:

“From 2001–2003, we took out nearly $150,000 in loans, mostly from credit cards and a few equipment lenders, ostensibly to help “grow the business.” Instead, it made us foolish investors in low ROI projects, contractors, office space and a variety of too-good-to-be-true salespeople.

By 2004, we could no longer pay the minimum dues on our bill and our debt skyrocketed. Credit cards with $30,000 limits quickly ballooned to $75,000 in “total owed,” thanks to nasty penalties + fees. After 4 years of attempting to make our consultancy work, the only logical move was to quit.”

Of course, they didn’t quit. They pivoted.

The mother-son team discovered that, as the web got busier and more crowded, their clients needed more than just a well-designed site; they needed a way to get people to visit. Other companies were approaching the traffic effort from different angles like banner advertising and similar well-known forms of marketing, but many of them had negative opinions about the emerging trend of SEO. Rand recalled, “In 2004, SEO was hated! It was reviled. There was this sense that SEOs were total scammers.”

Some may have seen that climate and run in the other direction, but Rand was intrigued. SEO represented challenge, potential, and — let’s be honest — a way to save the family business. Curiously, he began to seek out and learn all he could about SEO. Maybe there was something there that others couldn’t see.

“I liked it precisely for that reason,”* Rand told me. “I’m a very contradictory person. If conventional wisdom is one way, I want to find the exception to that rule and do that. It’s just something about myself. I like cheering for underdogs. I like going to small independent shops, not big conglomerates. It’s a personality trait, so SEO really appealed.”

It’s a good thing Fishkin was personally interested in SEO because to hear him tell it, there wasn’t another option at that point in the business:

“We couldn’t afford to pay the SEO consultants that we had for some of our web design clients anymore, and so it fell on me to learn the practice and start doing it because we’d basically promised the work and the results to our clients.”

Teaching as he learned

Within months, Rand had gathered a solid foundation about the existing climate of SEO, and he decided to start blogging about his learnings and experiences. In retrospect, his timing was perfect: blogging was in a transitional stage in 2004, primed for precisely what Rand wanted to do.

At the time, 62% of online Americans didn’t yet know what a blog was, but blogs had also grown by 58% in the last year. There were 32 million “early adopters” hungry for quality content. It was in that context that SEO Moz was born. Rand initially envisioned it as a library of sorts: a place to collect everything he was picking up about SEO and sharing across other forums and discussion boards. It wasn’t meant to be an income generator, but rather an improvised solution to his own inefficiencies:

“The initial catalyst for the blog was actually my frustration with posting on all these many different SEO forums and then trying to link up all the comments that I had made,” Rand explained. “I wanted one shared repository where all this knowledge and information I was learning could go and I wanted to have sharing and discussion about SEO in my own place.”

From blogger to consultant

When Rand first started digging into SEO, it was out of necessity to help Outlines West pay the bills. But by 2005, things had changed. Businesses were looking to the SEO Moz blog for best practices, advice, and leadership in the SEO space, and Rand was invited to speak at a few conferences (a few of which he was barely able to afford to attend).

This attention drove customer demand. And instead of getting inquiries for web design clients, they began getting inquiries for SEO clients, which lead SEO Moz to transition from a blog into company (SEO Moz later rebranded to Moz in 2013).

This was a key turning point in Rand’s fortunes. Folks who wanted SEO work, in general, already had a website. And they knew how they were making money from it. Importantly, this also meant that they had the money to pay for SEO services and had some baseline metrics to measure success against. They could see driving traffic from searches would get them a return on their investment, and so they were looking to improve that. And that just meant better quality and a more on-time paying customers.

Grandpa knows SEO

At its heart, Moz began as a family company: Rand’s mother is his co-founder, and his grandfather, Seymour Fishkin, brought his expertise in math and engineering to the effort of figuring out the inner workings of search engines. Rand told me what it was like to work with his grandfather in the early years of SEO:

“We’d print out all the search engine, information retrieval science papers, the PageRank patent and the TrustRank patent from Yahoo and all the different things about how you can rank content based on connected notes and links and content valuation analysis and spam papers and all this kind of stuff.”

Together Rand and Seymour would pore through all these papers and work through all the various algorithms to figure out how the search engines were ranking content.

“I’d see these equations with Greek letters in them and I’d be like, Papa, what does that mean?” Rand said. “My grandfather was really patient, and he’s a great teacher, and he actually wrote for the blog a few times back in those early days explaining some of the stuff.”

Some of the best advice Rand received about growing the blog and building the Moz brand the right way came also come from his grandfather:

“He gave me some really good advice after he read this blog post that I was going to put up,” Rand explained. “I was at his house in New Jersey. He read the post and said, “Well, this is good information, but the way you’re writing it is as though you have inherent authority rather than the humility of a journalist or an analyst’s perspective.

“His advice was basically, If you want to build an audience that comes to know you and like you and trust you, you can’t just assume that because you’re saying something, they should believe you.

“You should always, no matter how big and important Moz or you become, assume that you need to show your work,” Seymour explained. “You need to show the proof, that people can’t just take your word for it. Let the trust come from what you share, not from any type of status.”

“I’ve tried to keep that in my head ever since, especially as Moz has become much bigger and I do all these keynote talks and have this small, tiny amount of authority that comes from being well known in the SEO world. That has been really, really helpful for me, to both make sure I don’t get too big for my britches and make sure that I’m using that humility to try and grow an audience rather than assumed authority.”

The Unexpected Launch of a SaaS Company

[Before starting Moz] I did not know what a SaaS business was. When I tell you that I was an entrepreneur with no idea what the hell I was doing, I’m being totally honest. — Rand Fishkin

By 2005, the SEO Moz blog was growing. In December, Rand’s “Beginner’s Guide to SEO” struck a chord with readers, and they were featured in Newsweek that same month. The sudden growth and attention was surprising given the company’s humble beginnings, and it soon became apparent that Rand and his mom could no longer handle everything themselves. Time to scale.

They hired a few team members to handle the ongoing consulting arm of the business, and began to develop a small suite of SEO tools to solve problems they came across during their day-to-day work.

“They were little one-off hacky tools that would let us do some quick analysis or research things, or scrape some site content or whatever it was,” Rand told me.

“We were basically automating repetitive tasks. We had all these things, and I’d sometimes go to a conference or an event, or I’d be answering a comment on the blog, and I’d be like, “Oh, yes, actually, we have a tool that does that here at SEO Moz. Unfortunately, it’s only available to us internally, but we think it’s pretty cool.”

Eventually, the team at SEO Moz decided to open up their tools to the public as a way to share what they’d built, but even then, the tools were a way to drive interest in their consultancy business:

“We had a chat and we’re like, ‘Okay, maybe we could open up the tools so more people could see them, and the problem with that was we could get flooded and overwhelmed with requests. We’ll have a pay wall and we’ll make it really cheap, you can PayPal us $39 a month and we’ll give access to these tools so that way we can show them off.”

“We thought it was a way to get consulting business. We did not think of this as a software business. We weren’t sophisticated at all about monthly recurring revenue or anything like that. It was less an, ‘Oh, let’s go into the SaaS business’ decision and more like, ‘Hey, we want to show off our tools — how do we do that?’”

In 2007, with Moz’s SEO tools picking up a little momentum, Rand was approached by Michelle Goldberg, a venture capitalist from Ignition Partners, in his native Seattle.

“When Michelle emailed me that first time back in 2007, I literally had to Google venture capital,” Fishkin said as he recalled Goldberg’s original message.

“Hey, this software that you’re building looks really great and the SEO field is something that we’re interested in. Would you ever consider raising a round and trying to turn this into something bigger?”

“We were trying to make ends meet and this series of circumstance and serendipity led us to raising a round a venture and that made us more of a serious software company pursuing a particular kind of goal and scale.”

Moz went on to raise $1.1 million in funding lead by Ignition Partners, and the company, catching onto the potential of software tools, began to shift from a consultancy to a SaaS company:

“Our shift was brought on by a combination of seeing how things had been organically growing and Michelle sort of joining the board and pushing us. A venture capitalist does not want to invest in a consulting business, and so one of the goals that we knew we had when we took on that first round was to transition away from consulting to focus on software. We were excited about that, we thought that it was going to be fun to have our own product and to not have to worry about the selling and the pitching of clients.”

“I like the client work, I love consulting and in contrast I really hated the sales and the pitching process, I hated hanging out with a client and feel like “oh I’m in sales mode,” I have to constantly be putting on this good face and not being myself, hated that. The product really worked for us.”

How to be as accidently successful as Moz

As with many parts of Moz’s story, the impressive rate at which people adopted their software was a by-product of great content they produced and the humility Rand had learned from his grandfather:

“When it came to acquiring customers, I’m not even sure we’re good at it today,” said Fishkin. “It’s really one of those we became accidentally effective at it because the blog was so popular, because our content marketing efforts were so good and because our brand was well known and well liked and trusted. We just sort of have many, many people signing up for it. That was the thing that surprised us in 2007 when we launched the tools and then saw, in the middle of the year we looked at our PayPal account and went holy shit, this is making as much money as the consulting business and all we did was make it available, we needed these tools anyway for our own consulting work, this is incredible.”

“We’ve really been very accidentally successful at customer acquisition.”

Why Rand is still fumbling (on purpose)

Even when you’ve created as much content as Moz, you can’t guarantee success every time. And in Rand’s view, that’s just fine:

“I create a ton of content, I always think that I’m going to do well with it and hope that I will, but I have I would say three of four misses to every one big hit and that’s down from 10 or 20 a few years ago. It’s something that you need years and years of practice to improve that,” he explained.

Rand believes one of the keys to a successful content strategy is understanding who will amplify your content before you start to create it:

“One of the things that I say constantly is if you don’t have a great answer to the question who will help amplify this and why, don’t even create it. Don’t bother creating it, don’t bother publishing it. Until you have a great answer to that question who are the people who are going to help amplify it and why will they do so, don’t bother.”

Making content creation a part of your working and daily grind is an important part of success, too:

“Part of it is making content creating and amplification less of a special thing that you get all psyched up for and more of a task in your workflow. This is something I do and I create, I publish, I put things out there, I expect that I’m going to have many failures and a few successes, and I expect that I’m going to learn.”

Rand believes that content marketing success is much like going to the gym:

“You don’t think to yourself “Wow, I’m going to go to the gym and then I’m going to look in the mirror and I’m going to look the way I want.” No, you think about it as you put in the work, you go to the gym each day and you’re lifting weights and you’re running on the treadmill and doing the exercise bike and whatever it is that people do at gyms today. That practice is really the key and that’s what you should be focused on, not the instant outcome or result. The same is true in content marketing. When you’re publishing, creating, you are lifting those weights and eventually you’re going to build muscle mass, but if you expect it to happen in a day or a week or a month you’re kidding yourself.”

Rand’s 3 keys to marketing success for YOUR business

Anyone can invest in marketing the way Moz do — that is to focus on content, social media, and search to drive traffic with the goal that some of that traffic will convert to customers, and some will amplify your message further.

If you take this approach, Rand believes you should focus on the intersection of three areas:

1. Something you’re passionate about
2. An area where you can offer unique value
3. Something your audience and your audience’s influencers care about

1.Finding something you’re passionate about

“If you’re considering “should I start a blog?” Well, do you like writing every day or every week? Are you good at it, is that something that brings you joy and fulfillment and a sense of accomplishment when you do it? Or is it a tedious task that you’re really not looking forward to? Because if that’s the case maybe you should consider instead doing video, or doing a podcast, or doing visual content, or maybe you should consider creating a UGC community platform of some kind, or 10 different other potential content options, a free tool, a data visualization, whatever it is. You should find that first.”

2. An area where you can offer unique value

“Second piece is you’ve got to find an area where you can provide unique value above and beyond what your competitors do. If you think oh great, well I’m going to do visual content and I’m pretty good at infographics, but then you look out there and the field is super crowded with infographics, most of which never get any traction. There’s 50 competitors who are all playing that same game, well you might want to rethink that, maybe find the next thing that you’re good at.”

3. Something your audience and your audience’s influencers care about

“The third piece of that venn diagram to find the intersection for is something that your customers and your customer’s influencers will actually care about and want to use and find them through channels that they actually are part of. If you think this is going to be great, I’m going to do visual content and I’m very Pinterest centric, and then you find out well turns out your customers really don’t care for visual content and none of them are on Pinterest or Instagram or they’re not consuming a whole lot of visual content on the web. You might want to rethink that too.”

“You have to be able to reach your customers and your customer’s influencers. If you can find that intersection of all three of those you’ve got a great opportunity for investing in that content marketing flywheel. If not, probably should keep searching.”

Two final thoughts

My time with Rand has inspired my own entrepreneurial journey, and I hope it can inspire yours, too. When I look back on our conversation, I feel like two takeaways stand out:

1. A few accidents along the way can be more than just a good thing. They can be THE thing that determines our success. Rand’s example is proof that you don’t have to have an old-fashioned business plan to succeed in this new business landscape.
2. Be curious about opportunities as they come up. Be willing to investigate things that others around you are skeptical of, and be okay with swimming alone for awhile before others catch up. And they will catch up, so it’s best to get there first.

Thanks so much for reading, I hope you enjoyed this conversation. If you’d like to check out more, follow us on Soundcloud or subscribe to our publication.

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Originally published at frontcourt.co on November 29, 2016.