How Rand Fishkin is changing the way he builds companies

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    Most people in marketing know the name Rand Fishkin, but like all people in the public eye. There’s a lot more to Rand the person than they think.

    Rand was one of the early voices in digital marketing making the case for SEO.

    Back in 2004, he started writing about SEO on his blog SEOmoz, which later became the hugely successful search tool MOZ. He stepped down as CEO of the company in 2014 and left altogether in 2018.

    So in 2021, when Moz was sold to iContact, you’d have to assume he was ecstatic, right?

    Well, he tells the story pretty differently.

    Keep reading to learn:

    • Why Rand struggled to watch the company change after he left
    • How he thinks about building companies now
    • How he grew SparkToro to $1M ARR in under 24 months

    We help B2B SaaS companies grow through SEO. If you’d like to learn more about our agency, check out our SaaS marketing case studies or schedule a Free SaaS Scale Session.

    But first, if you’re already intrigued, you should check out our podcast episode with Rand. It is one of the most intellectually open and emotionally raw interviews I have ever done:

    Past is prologue: Why Rand’s history is the least important thing about him

    For people with a fixed mindset, history is everything. But for a person like Rand, history is only a factor in who they are.

    Rand’s ability to question the foundational beliefs of his work is admirable:

    “One of my favorite things in friends and just in people in general is that they strong convictions loosely held. And what I mean by that is you might fundamentally believe that Facebook is a net evil – a bad influence on society – and that if it were to not exist the world would be a better place,” he says.

    He points out that sometimes evidence or contrary opinions from people you trust presents itself and that it’s important to be able to assess that information critically:

    “You know what? I trust these sources. I think they’re independent enough. I changed my opinion. I’m going to shift the viewpoint, this historically strongly held viewpoint that I’ve expressed to lots of people and that I’ve posted about online, and rallied for on conference stages. I’m going to change that opinion. I love that. That’s how I want to approach everything that I, that I ‘believe’”

    And that’s actually an incredibly important characteristic for Rand.

    When you think about his position as a ‘luminary’ of the search world – the kind of person whose influence, ideas and content maybe even got you into SEO – it’s really impressive that he’s been able to move on and even openly criticise the big players in search like Google.

    This one belief being questioned would be significant, but when you put it all together with his other belief – that influence marketing may be the next big opportunity for marketers – then you really see his intellectual honesty in action.

    It looks like it’s paying off, too.

    When he and cofounder Casey Henry launched SparkToro in May 2020, the world was in meltdown and nobody knew or, frankly, seemed to care about what influence marketing was.

    Now, in 2021, SparkToro is about to hit $1M ARR – less than 18 months later.

    And that’s impressive.

    What is influence marketing?

    Influence marketing is the practice of understanding where your potential customers are and then taking messages to them in a way that suits the channel, location and intent of the audience.

    You might have heard of influencer marketing and recoiled when we started talking about it on the PBS blog.

    But there’s a difference: Influencer marketing usually involves paying a person (such as an Instagram star) to promote your product. Influence marketing (no r) relies on relating to your audience directly by hanging out in the places that they already like to spend their time.

    ‘I should have known you would make this right’

    2020 was an extremely challenging year for the world. One area where it felt we were undergoing a seismic shift – besides our lack of preparedness for a disaster scenario! – was the increase in awareness around social issues such as gender and race; income equality and overall access to opportunity.

    Rand was particularly expressive about this on social media last year and people really noticed:

    “Women in the marketing world in particular have been a big source of influence for me,” he says. “And I think just by being an empathetic person – or trying to be anyway – I get to hear a lot of stories that are horrible.”

    As Rand started to hear those stories, he was awakened to the fact that not everyone is able to access the same opportunities as he is. Quite rightly, he says that that is wrong and unfair at a fundamental level:

    “The way to be an evil human being is to ignore those things and focus on making money. My goal in life is to be not an evil human being and to try and do good. And I think the only way you do that, if you have earned some degree of recognition and influence, is to amplify the voices of those who have historically been marginalized and to, as much as you can, give opportunity and present pathway ways for other people to be successful who aren’t like you.”

    This is refreshing. It’s not often that you hear a public figure speak so openly and authentically about wanting to use their influence to give others a chance.

    But what does it really mean for Rand to improve the situation for others?

    A pain that he felt very acutely was realizing that he had, in a meaningful way, created an ‘extremely gender imbalanced’ engineering team at Moz during his tenure as CEO.

    “Even after years of effort [that still is] problematic and that’s true for tons of software companies, but that doesn’t excuse what was going on at Moz,” he says. “I have a lot of guilt about the things that happened after I stepped down as CEO, because I’m the person who chose my successor. I felt like I was responsible for, but no longer had control over, a situation that I strongly disagreed with.”

    “I’m the person who chose my successor. I felt like I was responsible for, but no longer had control over, a situation that I strongly disagreed with.”

    Once you’ve moved on from a company, it can be a real challenge to not look back. And ultimately, when you’re gone and you look back, you might not like what you find.

    “Folks internally at the company, even after I left, and folks in the community could tell that this was a way that I felt because I am not someone who hides their feelings well,” he says. “Because of that I got a lot of the stories from team members, from people who are disgruntled, from people who are having a hard time with the company, whether that was working with it from the outside or being a customer or being a community member or whatever.”

    It’s hard to imagine how difficult that must have been for Rand. To be outside of a company he started, hearing unhappy stories from people he liked, but with no way to offer resolution or improvement to them.

    And when Moz was sold to iContact, things really came to an acutely painful point.

    “Russ is a delightful guy. One of the most interesting and humorous and loving people you could ever meet. He’s from North Carolina and has these three little girls. I recruited him to come join MOZ. Every time we’d go out to North Carolina for the Moz conferences out in Raleigh, we’d go visit him in his family.”

    The Russ who Rand is talking about is Russ Jones.

    Russ was a well loved and highly respected figure in the SEO community. And when he died suddenly in June, 2021. The marketing world started sharing the most heart wrenching stories of how Russ had impacted everyone’s lives.

    By the time that the sale of Moz happened, Rand was completely detached from the company but was due to receive a sizeable payout because he still had a stake in the company.

    Russ emailed Rand to express his concerns that the deal was not good for option holders and shareholders.

    Rand explained in a reply that he was no longer part of the board and wasn’t part of the deal at all but that if he heard of anyone who was not getting the payout they deserved, Russ should message him because he and Geraldine would be writing personal checks to compensate them.

    “And Russ, like just before he died, just before he died. Russ writes back and says, um, ‘Thanks, man. I should’ve known that you would try and make this right.’” Rand recalls, his voice trembling.

    “I cannot tell you how much that email means to me. The guilt and the trauma and the heartache that I think I would have always felt if, you know, if Russ had passed away and I had thought that he was still upset or, you know, that he, he thought that the deal was no good.”

    “I cannot tell you how much that email means to me. The guilt and the trauma and the heartache that I think I would have always felt if, you know, if Russ had passed away and I had thought that he was still upset or, you know, that he, he thought that the deal was no good.”

    Zebra, not Unicorn: Why SparkToro is closer to being a success ‘than Moz ever was’

    The whole experience of leaving Moz has certainly – and noticeably – made Rand an empathetic person and it’s clear that he has spent a fair amount of time questioning his beliefs about a lot of things.

    So how does that impact his view of growing a company now?

    “SparkToro’s goal is to be more of a Zebra than a Unicorn. We believe in organic, profitable growth. We’d rather be the best product in our space than the biggest company,” he writes on the SparkToro about page. “We want to delight customers, help everyone in our field do better marketing, give our team great professional lives, and deliver returns to our shareholders… in that order.”

    Measuring building a company like this, Rand is able to say: “SparkToro today is closer to being a runaway home run success for its team and investors and employees and customers than Moz was at any point in its journey.”

    So what’s the growth like?

    Well, recently, Rand shared on Twitter that SparkToro had more new users in a 36 hour period than in the entirety of the previous month:

    What strategies and tactics did they use to grow the company so fast?

    Pricing changes

    Pricing is a huge point of leverage for marketing a B2B SaaS company and actually it’s also one of the most undervalued levers too.

    We often hear our clients talking about their SaaS pricing pages, but we don’t always hear them talking about how they’re rearranging their packages or changing the pricing itself.

    And they’re not alone. A lot of SaaS businesses don’t consider this.

    SparkToro changed the allocation of features to pricing tiers:

    “We told folks that at the lowest tier ($50/mo), if you were already a subscriber at that level, You would basically get all the benefits of the new level, but none of the detractions,” he explains. “So access to certain tabs and features inside the product were going away for people at that basic tier and they would only be available at the higher tiers. But if you were already a subscriber before this change, you were going to get locked in.”

    We talk about demand gen a lot at Powered by Search. But retention is also a significant opportunity for any B2B SaaS.

    Offering added value to existing users for the loyalty they’ve shown to your service is a beautiful way to improve likeability and brand affinity – those two things have a huge impact on retention overall.

    But beyond speaking to existing customers on that tier, what did Rand do?

    “We sent this [news by email]. We sent one [email] to people who are already subscribers and another to people who weren’t yet subscribers. Obviously a bunch of people who weren’t yet subscribers jumped on that legacy tier before we made the change. That was a big part of [the growth].”

    This is actually a really smart thing to do.

    Prior to making the changes, Rand emailed the entire email list they had collected from a couple years of extensive blogging, tweeting and podcast appearances to say that pricing would increase soon.

    Aligning features with customer need

    The other major change that SparkToro made during this period was to introduce a few well targeted features to the product.

    “Demographics essentially gives you a whole bunch of data about classic demographics, like gender, age and geography, but also things like education and job title and role and company size and all that kind of stuff, he says.

    But here’s the really important thing for the growth:

    “It’s one of those things that we realized that by having social profiles, across many platforms […] That data was super useful to a ton of marketers especially in brand world, persona building world. I think that’s where the signups come from.”

    “That data was super useful to a ton of marketers especially in brand world, persona building world. I think that’s where the signups come from.”

    What Rand’s describing here is a mixture of customer and product market fit. And positioning aligning after a lot of marketing efforts from the founders.

    All of the podcast appearances and all of the articles where Rand’s talked about moving from search to influence marketing? Those have all added up in marketer’s minds.

    And when you combine that with a feature or feature set they care about, they’re not seeing SparkToro as a search product anymore – but a market research product. That changes the perceived value of features massively.

    And that is why positioning is so important: Because when you’ve got it right. It feels like pushing a boulder down a hill.

    Want to improve your positioning? We have a tool that can help you do that.

    What were the results of that work?

    Rand says that the pricing change, moving the features and limits in each tier, doubled the conversion rate.

    “That was the one that really surprised me because I did not expect that we would have such a larger growth rate just by changing what the pricing tiers looks like,” he says. “We were at something like 2% of people who visited the pricing page, converted to a paid subscription and now it’s a little over 4%.”

    “We were at something like 2% of people who visited the pricing page, converted to a paid subscription and now it’s a little over 4%.”

    While the pricing page isn’t the only thing that improved the growth rate – as we mentioned, product and customer market fit as well as the actual pricing structure changed too – it’s a key area of opportunity for a lot of SaaS businesses.

    In fact, we’ve found that 90% of B2B SaaS companies either don’t have a pricing page at all or don’t have one that is actually optimized for conversion.

    SaaS Pricing Page Structure

    We talk extensively about pricing pages and the opportunity that they present for SaaS businesses in our authority architecture post which outlines the elements that we use as best practices for SaaS websites.

    Closing words

    It’s easy to get caught up in growth metrics, marketing strategies and company building when you’re in your day to day.

    But remembering the depth and breadth of our shared experience is vital to understanding not just where we’ve been, but where we’re going.

    Ultimately, understanding others is one of the most important skills for marketing anything – but empathy is its own reward.

    Who wouldn’t want to understand others and be understood by them in return?

     

    Photo: Rand Fishkin