Jeremy Weisz 16:12
Like, social media, I don’t know.
Jonathan Tilley 16:14
Yeah, I think, meetup.com, was, was, was a driver in the initial days, we had a few friends in the space. So word of mouth, I created a kind of a breakfast Meetup group as well with entrepreneurs in LA, trying to foster entrepreneurial spirits. And there was a lot of word of mouth and people that they knew from that that’s got some people in so, yeah, it was very much just…
Jeremy Weisz 16:42
It’s real grassroots, like inviting people to an event presenting. I totally relate to this Jon. When I was practicing chiropractor in Kentucky, I would have a free dinner workshop that I would give about spinal health. The way I got people there, I would, this is almost embarrassing, actually, but like I would, this is what they had us do. I would hand out free. I would stand outside of like grocery stores and other venues and hand out free dinner cards, spinal workshop, dinner cards. That’s how I got people to go and then I give a talk and educate them. So you were doing it more sophisticated than I was.
Jonathan Tilley 17:31
Yeah, even then, it wasn’t really that sophisticated compared to what you can do now. But, yeah, it wasn’t interesting. That was my first entrepreneurial gig, and startup, and Adam was a great mentor in that stage. And just going, like, hey, like, it’s coming, we’re going to get the first 50, the first 100, the first 1000, the first X 1000, you know, just kind of keep going. And that’s what the beauty of SaaS is, if you’ve got a great product and you can retain them. You build on that, right? So that idea of patience and determination, I think, was, was key in those in those first few days.
Jeremy Weisz 18:10
I thought you were going to say Adam was teaching e-commerce education, a bunch of people, you offered to them, and they signed down. But it wasn’t that. It wasn’t that smooth.
Jonathan Tilley 18:20
Oh, well, no, that was, because, remember, he was now based in Australia, so he was creating his own community, and that was a big funnel for us, for sure. I mean, that got us our start, and managed to allow us to bootstrap it with the influx of customers. So that was the biggest marketing engine for us for the first couple of years. But outside of that in LA. And what I was doing, was kind of bootstrapping, but that first 100 was definitely before the education side that came later, and that’s, you know, started to hit us with our 1000s of users. And some milestones there, of going over to Australia, we had events there that we were presented to 4,500 people. And kind of walking through, yeah, the ideas and the passion around Amazon, right? Which, which I still have today. It’s just an epic platform for, for anyone out there to help scale their financial growth, yeah.
Jeremy Weisz 19:14
When you look back, I’m sure you got a lot of feedback over the years. What sticks out to you as feedback from a customer that helps shape a key feature or product that you offer?
Jonathan Tilley 19:33
Yeah, that’s an interesting question. Not one specific client jumps out in terms of, hey, they directed our product. But I think we certainly have many, many customers that have just given us some fantastic feedback. I think one of the cultural things about ZonGuru, which is important is that, from the very first day, you know, of starting ZonGuru, I incentivized our team to become sellers, because I understood this idea that, like in today’s world, everyone’s going to have a side gig, or at least, should be trying to become a business owner in some fashion, and in our space, you know, why not become an Amazon seller and that’s certainly something you can manage on top of your day job, right?
And so we started to build and still today, we have some very successful sellers and strong DNA from people inside of the organization. I think we’ve actually got an engineer who started with us a year ago, and he’s just clocked, he just clocked his seven figures on his business. So it’s still happening today. But that kind of internal set of DNA and passion that we had from our team that’s always been one of the things that people have really responded to is like, we get them, we want to help them. The passion is there, and we help them along the journey. So, I think that’s more the theme that I would take, rather than them just directly inputting into a specific feature.
Jeremy Weisz 21:08
How do you decide on pricing early on?
Jonathan Tilley 21:12
That was competitive driven at the time? Yeah, I mean, that was our first take on pricing. Was like, hey, how can we take all these potential different tools, we’re going to put them into one? And how do we come up with a price? It was purely kind of a what’s in the marketplace, and how should we price? Obviously, we still consider that, the evolution of that is definitely more of a SaaS focus, which is looking at your contribution margin, your tech costs, and ensuring that you kind of at that the 20% gross margin, and you can scale from there. So, as your business scales, and certainly in our case, because it is such a sophisticated tech, there’s a lot of costs that we have to account for. So figuring that, inputting that into our costs, pricing, is critical.
Jeremy Weisz 22:08
How did the team change? Initially, your bootstrapping, you had a team in India create it word. How’d the team evolve over time?
Jonathan Tilley 22:17
Yeah, it evolved massively. And I would say that the going back to that challenge, as we started to scale, I clearly had a frustration with our current tech team, in that there wasn’t a desire or a curiosity to truly understand what we were trying to do, our target audience, our products, our business objectives, was more about like, hey, yeah, let’s just create the software as easily as we can, and not really think about the scalability of the product. And so I started looking elsewhere. And I gravitated towards Eastern Europe, and I started working with an agency over there. But during that process, we had kind of a big problem with one of our tools, and I found a seller who had created an API that I started using in our products.
And that seller, who was also an engineer, is now our CTO of Stefan and my partner, Stefan Rachef, He’s based in Sofia Bulgaria, and so we just kind of started our conversations, and then just made sense to bring him in as a partner, and that’s where the magic really started to happen, because he’s got a major pedigree on building enterprise tech for large companies. But he had also started his own side hustle selling on Amazon, so he clearly understood our audience, our business objectives. And the magic just started to happen there, and we built a team around that. And if I could give any insight into building tech, if you can create a culture around what is our strongest value, which is curiosity and you can get your team to truly understand your product, your audience and your business objectives. And they can want to figure that out for themselves and then create a scalable, a solution with a vision.
You’ve got magic and gold happening right there, and that’s what we have internally inside of Zonguru. Is a team that is always curious, is always trying to figure out how to solve things for our customers, for our tech, our industry. They are sellers themselves, and they are certainly not just trying to get their fastest with a shortcut, but something that’s truly scalable, because they have an investor interest in, you know, us becoming a massive tech platform with thousands, tens of thousands of users.
Jeremy Weisz 24:53
So Jon, you find this magical unicorn, which is like a seller who’s an engineer. Who you can have come on, at what point of the company does that happen? Like, how many years have gone by that you were working until you found this person to bring out a CTO?
Jonathan Tilley 25:14
This was late 2017 early 2018 around that time.
Jeremy Weisz 25:18
So it’s very early on.
Jonathan Tilley 25:20
Yeah.
Jeremy Weisz 25:21
So it was maybe a couple years. I asked because I’m curious about, how do you structure bringing someone as a partner, right? You’re already working the business. Both you and Adam are working the business for a couple years. How do you structure the partnership? Is there somewhat of a buy-in, or you just give someone a percentage based on the valuation. How do you think about structuring? Because someone listening may be like, you know what, obviously, it’s a huge incentive to bring someone you want them to be dedicated so making them a partner. But how did you think about the equity piece at that point?
Jonathan Tilley 26:00
Yeah, I mean, the short answer is that, if you can find that unicorn and someone that can fit your business and has that expertise and your technical skill, you want to bring them in. And we gave a significant portion, or a percentage of the business with a vesting over four years, right? So that’s the general structure that we put in place, and a salary to boot as a working partner on this right? There was no, kind of buy-in or anything along those lines. We truly knew that the assets of his expertise was going to pay off, if he stuck around and he has, and the gig at the time was like, okay, well, we have this core base of users. We have pretty crappy built Tech with good vision and good solutions, but the back end was just a mess.
So how do we literally transform that into a brand new platform that is scalable, and that took about eight, nine months to kind of rebuild that whole thing in the right way with the right people. And I mean, honestly, if I tell you, if we push anything live right now. We hardly ever get anything that breaks. It’s truly unbelievable the team that we built it.
Jeremy Weisz 27:28
Talk about building, creating tech for agencies, and what are some of the things that are in the product in ZonGuru, because of that, because I’ve seen software like I’ve gone into software, and you could tell it was not built for agencies. I mean, it’s not built for it at all. What were some of the things you had to put in place, because you do, I know you do have an enterprise solution tailored for agencies.
Jonathan Tilley 27:56
Yeah, the backstory to that was, it was around maybe two years ago now, kind of out of the pandemic, as everything e-commerce started exploding. Profits were massive and the whole agency services side really blew up. Everyone was starting to use agencies, managed services, trying to scale. And certainly the transfer of big brands from retail onto e-commerce and Amazon was huge, so trying to service them at a more sophisticated level was the goal. And we actually brought in a VC partner at that stage with the goal of saying, hey, how do we invest in and start to explore this specific segment of the market? Because at the end of the day, that’s one of the biggest growth areas, and certainly taking us more in line with kind of enterprise growth and where the market is going.
So, we got that, and we started exploring how to service them. And I think, one of the biggest wins we’ve had for agencies has been part of our DNA, which is that lens of always being, less, shiny object, focused really focused on more. What’s the 80/20, what’s the most impactful data. How can we present that? And how can we do that in the most fast and efficient way? That’s kind of the DNA of our tool. So that has worked for agencies, for sure, because when you’re doing things at scale, those kind of things matter. But the few differences we’ve done is one, you’re right. Architecturally, we had to change the platform for enterprise, and we built a structure where you can have kind of a sub-project view for each client, and then have the ability to give permissions access to that for anyone on the team, for certain tools, etc. So it’s a much more scalable, flexible system that can be molded to how an agency wants to use it. So that’s one of the biggest differences. And then the big ones to date have been more on the bulk optimization side.
So, going in and just tracking keywords at an individual level, having to input that, or those kind of things. It just doesn’t work at an agency level. So you need to be able to do things, set up at bulk, and then, and then do some optimization work at bulk. So that’s been a critical piece. And then I think the other big advantage has been around, we’ve always taken the view of like, we’re not trying to create tech to help the agency grow. What we’ve done is we’ve focused on, how do we create tech to help the account manager be more efficient and set a higher level of quality of their output in their work right, or their account manager or their listing or the optimization experts, and so that’s been a really big thing for us, because at the end of the day, as an agency owner, if you’ve got a team of people working on your client’s business, and their quality level is set at a higher bar, and they’re getting the right kind of insights to make impact on that business, you know, that’s ultimately, you know, where the rubber meets the road and how it can be successful. So it’s figuring out in that mix who are the core target audiences that we’re going after, and then how do we service them better, has been important in our kind of evolution.
Jeremy Weisz 31:34
You had, Jon, an agency out of Washington. What kind of ways were they using ZonGuru?
Jonathan Tilley 31:45
Oh, yeah, yeah. I would say most agencies that use our product, including the one out of Seattle, Washington is around our SEO aspects of keyword intelligence and listing optimization, that’s where they start. And this one in particular is a very data-driven agency, a lot of ex-Amazon employees with some very sophisticated, large accounts. I think their portfolio is 300 million in revenue. And they had very specific techniques of how to optimize for organic growth, and that was all in-house, and they started to use our system and had better results with better niche rank, better BSR, and just performing at a better level.
So it’s kind of that feedback that we get when, if I just reflect on me personally as a CEO, sometimes when you’re trying to sell your product to brands, Amazon sellers, in that more of an inbound fashion, they don’t necessarily fully appreciate to understand your product and know how to use it in the best way. And it’s when you connect with really sophisticated sellers, and they’re like, wow, this is insane. And the results are there. It’s pretty cool to get that pat on your back and that validation that you’re doing the right things right coming from experts, ex-Amazon employees who built the algorithm, and just going like, you guys nailed this, which, which is a pretty cool feeling.
Jeremy Weisz 33:25
What have you said no to? I’m sure you get requests, you see other software out there, or you get requests to do things. And also, I think saying no also creates a more robust partner ecosystem for people, right? Because you’re like, okay, they do this. We do this. And I know you have a, actually a partners page, which I’ll pull up in a second. But what have you said no to that you’re no, that’s not what we do. That’s not the core of our product.
Jonathan Tilley 33:59
Yeah, I think that’s a really interesting question in that, our approach in going to the market was more of this all-in-one soccer so in a nutshell, we said yes to quite a lot, which sometimes I’m like, hey, there’s advantages to having a number of tools, but there’s also a lot of advantages to being very specific in one area. So that has been a challenge for us, not only on creating tech at the highest industry level, but also in terms of marketing, right? Because you’re marketing to a bunch of different areas. But outside of that, the big things we’ve said no to is one has been PPC software, that was on the cars at one point, and we said no to that, just because, purely, I feel that that’s a whole tech into itself. We’ve said no to very deep inventory-level management software, which is another whole world. And we’ve also said no at this point to omnichannel. We focused specifically on Amazon globally and that’s been very successful for us, and we’ll hold on to that for some time.
Jeremy Weisz 35:20
Yeah, so I’m looking, you can see I’m on the partners page. And that’s kind of where I was when I look through it, that sticks out the most, right? Because the PPC piece, right? I imagined that you said no on purpose to that, because that’s a beast in some of those other things. And here are some of the other you can check out zonguru.com/partners, and just see some of the other partner companies that they have on the site here. I don’t know if there’s any one or company notable that has been impactful as a partner for you on this.
Jonathan Tilley 36:03
Yeah, I think we have a lot of, obviously, agency partners that we service and are doing great things in the space. This is our general partner page. We do also have some integrated partners inside of our app, which you can’t access without obviously logging in. But the idea there is, we have a customer base, and there are specific areas that we have said no to, and we want to make sure that we can recommend that service or software to our users. And notably, those are partners that we vetted, that we use internally, with our own sellers and with our own management team internally, and we know it’s a really good software. So some of those are things like scale insights, is the PPC software that we support. They are based out of Singapore. A lot of seven-figure plus sellers use the software Prophecy Chad Rubin, that’s definitely one around pricing, automation that we support. Seller Candy, you know, John Cavendish…
Jeremy Weisz 37:19
Yeah, I saw that that looks pretty cool.
Jonathan Tilley 37:22
Yeah, they’ve got kind of a customer support service for all the challenges that come out of Amazon.
Jeremy Weisz 37:31
Seller Candy. Here it is. Seller Candy acts as a technical army. It says, never talk to Seller Support again. That’s a great tagline, right there.
Jonathan Tilley 37:40
And they have a refund service as well. So we partner with them and all of these guys that we partner with, you know, a critical point there is they have to fit our value set right. And not only they have to have great tech or services, but they have to have our value set because, again, we want to make sure that if we recommend this to our customer base, they have a similar experience dealing with these partners as they do with us, right? And so I always look for that in our partners. And certainly Chad, John, Daniel from Scaling Sites, those guys are all, I don’t want to sells joint brands, the guys from million dollar seller club, those guys all fit our value sets. And I’m just really passionate about our space, right? Which is good,
Jeremy Weisz 38:31
Talk a little bit about I saw on your site that you have a growth audit. And I imagine, you’ve been a seller before, and so what are you looking at in this growth audit?
Jonathan Tilley 38:47
This is a challenge that’s come out of us, talking with our kind of top brands that we connect with, and also with our agencies. Which is the biggest kind of problem of 2023 which is, the common theme is, hey, we might be flat in sales, or we might be growing in sales, in revenue, but the cost that has cost us to get those sales has been much higher, PPC, Amazon fees, the impact on Profit has been substantial. And so this idea of the growth audit has evolved out of the brainchild of our engineers and our sellers, which is trying to understand, of your product, that your products that you sell on Amazon, you know, what is your current revenue, that you’re doing, and what’s the obtainable tam revenue that you can actually access that’s realistic based on the keywords that you index for and where you rank for those keywords.
And the idea behind the growth audit is to follow a data-driven method that we use to grow brands, which is focusing around the keywords in position 25 to 60, which is slightly off page one of Amazon, which really is, showing you that Amazon already recognizes you as a strong seller on those keywords, but you’re not quite in the buying zone. And it’s about, how do we figure out what’s the value of those keywords, and then what are the strategies we can use to get better ranking on that and tap into that buy zone and the revenue that can come out of that. So that’s the purpose of the growth audit. And we’ve put together an analysis where we look at those keywords and how to get there, and the strategies around it.
And we also look at a pricing analysis, which is a really cool way of looking at, how are you priced in the marketplace versus your competitors, and at that pricing tier what’s the actual obtainable tam that’s available to you in terms of revenue? And so through those strategies, it helps brands scratch the itch around like, what am I selling on Amazon right now? What can I potentially be selling? And actually, am I priced at the right price points to effectively compete, and am I competing for the right kind of revenue that’s available to me on Amazon? So, yeah, it’s a pretty cool audit, we’ve put it in place, and we run it as a manual service from our kind of base of our team for qualified brands, right? So they’ve got to be at a specific level, typically, about one and a half to 2 million and up on Amazon, as an established brand. And then we’ll run that order for them, and help them see what their potential profitable growth can be in 2024 which is cool.
Jeremy Weisz 41:38
Want to talk about some resources. Jon, what are some of your favorite conferences in the space?
Jonathan Tilley 41:46
Yeah, I like seller conferences, right? And what I mean by that is one that has a true DNA of sellers. And you go there, and you just all of a sudden connect like-minded, in a like-minded way with others there, and they get you. And we all know the space. And the one that really stands out for me is AMZ Innovates in New York. We went to it last year. And there’s so many conferences that are out there, but, and they’ve evolved. Prosper is obviously, you know, still a well-known one, but that evolved. It’s more like a services industry way of connecting, which has lost a little bit of that set of DNA that originally had, but AMZ Innovate, and the guys from MDs that are a big supporter of that was, was, was awesome. And so I’ll continue to go to that one.
And, yeah, we have another one, the European Seller Conference, which has a very similar DNA, which will be happening in Prague, I think, this year, which we’re attending, that comes out of the orange click guys, who are always a good supporter of ours. So those are two that just pop, front and center. But yeah, just going to those. And just hearing stories from true brands that have absolutely scaled a beast on Amazon as one of their channels, not the only channel, but just being a reminder of how good of an opportunity e-commerce is, and specifically Amazon, in terms of scaling a proper brand it’s just a good reminder and insane to see. It’s just awesome,
Jeremy Weisz 43:29
Jon, I have one last question before I ask it, I just want to point people to check out zonguru.com, to learn more. And like you talked about, there is something on the homepage, actually, that they can check out if they’re interested, and if they qualify for the growth audit, like you said, they can click on that. My last question is, just as far as it could be books, some of your favorite from a business perspective, that you learn from. It could be mentors, mentors that you learned certain lessons from. What are some it could be books or mentors that you could share with us, that people can learn more about.
Jonathan Tilley 44:21
Yeah, the one that comes to mind, I would say, right now is the EOS system around Traction and the OKR system, which came out of Google. The objectives and key results. We did a really deep dive as an organization at the beginning of this year around becoming more of a results-focused, growth orientated, company, which sounds funny to say, but there’s so many things going on that you can, it can become not just your only focus, right? And I think we’ve done a really deep dive, and re-engaging with those systems, and we’ve actually built out a very deep, okay, we actually ended up choosing the OKR System. And we built out a very deep way of tracking all of this within notion, if anybody’s interested, we can there’s just, there’s nothing in the space.
So we created a system, which actually the guys at Escala, Yani Kozwinski, they’re all very deep into creating scalable systems. And they checked out our OKR System, and we’re blown away by it. So that’s a system that comes top of mind right now, and in terms of mentors, I guess the one that just pops to mind is kind of a general one, but it’s been out of, it’s came out of some conversations of late, which is just understanding that as a business owner, you have to have a partnership and a focus on, obviously, creating good, great tech. But there is absolutely an important piece around vision and brand, right, and owning that brand. And so, Richard Branson, those kind of guys who were truly, that’s what they were best at, is focusing on the brand is definitely always an inspiration, and something I can always take out of more.
And I had a recent conversation with a friend who was kind of losing a bit of a passion for his current business. And I was like, yeah, he was getting stuck in the spreadsheets. And I’m like, that’s your other partner’s gig. They should be doing that. You’re the brand guy, and that’s where you get your joy and your drive from, and what you’re good at. So focus on that, right? So, yeah, that’s, I guess what?
Jeremy Weisz 46:55
It’s like, the visionary and the integrator. So he was losing a bunch of his energy because he was probably looking at the integrator task, and this person is more of a visionary type of person.
Jonathan Tilley 47:06
Exactly. And, yeah, just that insight that you know, no matter how small the organization, even if you don’t have your right-hand guy or right-hand partner, there are people in your organization that are better at things than you, and you’ve got to get them to focus and don’t try and do that? Like it came up in our workshop. They were like, yeah, Jon, you kind of suck at this. And I’m like, well, it’s okay that I suck at that, because you guys are better than me, and I can be better at this, right? So you don’t necessarily have to a degree, trying to improve those things that you suck at. You focus on things you good at.
Jeremy Weisz 47:39
Love it. First of all, Jon, I want to thank you. People can check out the EOS what he’s talking about. There’s a book Traction by Gino Wickman. Actually, I did an episode with him, so you can check that out as well. And then one of the other books is popular that Jon mentions. Measure What Matters with John Doerr, they can check that out too. But Jon, thanks so much, everyone, we’ll see you next time.
Jonathan Tilley 48:03
Yeah, thanks. It was amazing.
