The Insider Series: Q&A with Steve Lazuka

Marketing Agency Insider introduces the Insider Series, designed to feature professionals in our industry, offer business insight, and discover new paths in the agency world.

On Building Agencies and Serving Them

By keeping ahead of trends, and driving demand for emerging services, Steve Lazuka went from building web and SEO agencies, to creating technology platforms that help agencies grow.

Steve’s most recent venture, Zerys, is a content marketing management tool and writer marketplace for agencies and businesses. Zerys joined Marketing Agency Insider as a founding partner in late 2011, and it was then that we first learned about Steve’s journey in the marketing agency business.  

He was kind enough to share his detailed story with us, offering proof that doors can open when you trust your instincts, make the right connections and remain open to new directions.

Advice for Entrepreneurs

Steve’s key advice for those starting a marketing business includes:

  • Keep your business model ultra-simple to start. Some of the most lucrative models are the simplest. Having too many choices makes it harder to sell since customers can’t get their head around the pitch.
  • Never follow too rigid of a plan. If you don’t know where you’re going, you can never get lost. Always be ready and willing to shift your model on a dime if need be. Don’t hire people based on their resumes—hire based on their will to succeed—everything else can be trained.
  • Above all, follow your heart.

Steve LazukaQ&A with Steve Lazuka

Q: As a kid, what did you want to be when you grew up?

A: Superman.

Q: What was your first job out of college?

A: I worked for my dad, delivering coin-operated machines (pool tables, juke boxes, etc) to bars and restaurants around Cleveland, Ohio.

Q: What is the story behind your first company, Website Results?

A: In 1998, I got a spam email from a few guys in St. Louis that said they were putting on a web design/SEO conference in Las Vegas… so I signed up. Apparently, I was the only sucker that signed up, so they called me and told me they had to cancel the event. We got to talking, and found they needed a web designer and hired me to do some web design for them.

A few months later, they told me they were moving to Los Angeles to start a new company and asked me if I wanted to join. So we all packed up and moved out to LA. Initially, there were four of us living in a few apartments in Culver City. There were some tough times getting started, but we somehow managed to get through those early days. One year later, we had grown to more than 35 people.

Q: During that time, was SEO widely accepted in the marketing industry? Did you need to educate your prospects?

A: At the time, most people thought of SEO and web design as separate. SEO meant sticking keywords in your content a bunch of times. I think we were one of the first companies to try and educate people that SEO and web design were deeply connected–that you had to consider basic SEO from the very beginning when designing and coding your website.

Initially, we thought of our company as a web design company, not an SEO company. However, we quickly learned that SEO was what people really cared about. Everyone wanted to be listed at the top. At the time, AltaVista was the big dog.

Q: What were your biggest challenges in starting and growing Website Results?

A: The biggest challenge was having no cash or funding. We had to sell packages each day in order to eat and pay our rent in that month.

Also, working out of an apartment building made it tough to recruit experienced professionals. They would come to the interview, look at our offices, then laugh and leave. So we had to hire a pretty rag-tag group at first, but the truth is, there were no experienced SEO people to hire back then and we were all making it up as we went.

Q: What lead to your next venture, Infosearch Media?

A: After two years, Website Results was doing about $1M per month in sales. In August of 2000, 24/7 Media bought us for $95M. It was the largest sale of an SEO agency at the time, so it was pretty exciting. 24/7 Media moved us out of our apartment building and into “real” offices in Los Angeles. I became VP of Operations for our division.

One year later in 2001, it became clear to me that the old, automated methods of SEO were becoming less accepted and less effective. I started to get the sense that the future was in creating quality content, written by real, live humans. I suggested we start focusing more on content development so we could rank in the organic search results in a natural way that wasn’t going to upset Google or anyone else.

At the time, this suggestion was not taken seriously because it seemed impossible to create enough content for the thousands of pages we had at the time. This was the very beginning of my obsession with designing processes and systems that allowed us to create lots of quality content, at an affordable rate.

Eventually, I took the leap of faith and left 24/7 to start Infosearch. I rented a second apartment, hired a sales person, and started selling. Again, I had no money, so we had to sell each day to survive. There were some tough times, but it was exhilarating to finally be building something on my own.

Within two years, we had 70 people. Thirty-five of those were salespeople. We used 100% outbound marketing. It was a sales machine. Looking back, we probably focused too much on sales, and not enough on product development. With my current company, we are doing the exact opposite.

We ended up selling content to some big brands like eBay. At one point, we provided a ton of content for Demand Media, before they raised $300M, hired some of our developers, and built a similar system to generate their own optimized content for their network of sites like eHow.

Q: How did technology, and state of the industry at that time, affect the way you built and managed this agency?

A: Once we realized that content was the future, we started selling mini-websites that included a guaranteed submission and top ranking in the Yahoo directory, which was simple at the time. Eventually, we started tracking clicks and charging people per click. Overture was the main PPC model back then, so people were use to funding their account up front to pay per click, so we did the same thing. By getting money up front, it allowed us to grow quickly.

I remember one day when Yahoo suddenly changed their search results to show Google results, rather than its own directory results. I had seven employees at the time. One of them came up to me and said “Steve, how does this new change impact our business?” I remember thinking that the honest answer was “Well, this just killed our business!”

But instead, I communicated to everyone that it was the best thing that could happen to us because now, we could optimize for Google and get even MORE traffic for our clients! Amazingly, my fake excitement spread and somehow we made it a reality just by believing it.

Q: Was web content still a new concept for your prospects at the time? How did you communicate the opportunities on the horizon?

A: Yes. At the time, very few companies focused on content development. Early on, I realized that we were really onto something and were ahead of the curve. We would go to the search engine strategies shows, and out of dozens of booths, our company was the only one focusing on content creation.
It seemed like no other companies at the time wanted to get involved with content–it was too complicated and expensive. Everyone wanted to build automated solutions instead (pay per click, analytics, etc).

We sold all of the benefits of fresh quality content to our prospects. Our main pitch was explaining how adding lots of great content helps establish you as an authority in your field, helps drive more search engine traffic, and builds trust in your visitors.

Q: What led it to become the first SEO/Content agency to go public in 2005?

A: In 2003, we decided to raise some money so we could grow even faster. We hired an investment banking firm. We put together a nice presentation and traveled all around the country pitching to people. We were about to do a VC deal for $10M when we met a group that proposed taking us public through a reverse merger. We ended up going that route.

At first, it was pretty amazing to be able to look at Yahoo Finance and see our shares trading publicly each day. Initially the company was trading with a market cap of $140M. Many of our first employees had good chunks of stock and they could track their actual value.

Unfortunately, going public did not end up being all it was cracked up to be. If I had to do it all over again, I wouldn’t do it.

Q: Where did you come up with the idea for Zerys?

A: When we first started Interact Media in 2007, the plan was to be an actual content agency that sold content to clients.

We looked at the various content development/management systems and I was amazed to see that there still was no complete, private-labeled, out-of-the-box solution that allowed agencies to manage all their clients’ content projects from start to finish. That’s when we decided to start building a new solution that picked up where our old Infosearch technology left off.

The more we built the system, the more we realized that we were building something that other agencies could really use, and we decided to become more of a software platform, rather than an actual agency.

Q: How many freelancers have joined your network to date? How many customers do you serve?

A: About 19,000 freelance writers have signed up over the past year or so. About 4,000 of those are active writers. We’re getting 10-20 new writers signing up per day. We have an extensive application process that weeds out most writers before they go active.

As for clients, we currently have about 3,500 end users, about 350 marketing agency users, and another 1,000 agency clients that are being managed by agencies in our network.

Q: Have you used your knowledge and experience in running an agency to build your Zerys for Agencies product?

A: Yes. Absolutely. My experience at Infosearch, actually running a content agency, was the inspiration for our Zerys for Agencies product. During the many years at Infosearch, selling content packages to more than 4,000 clients, I was able to learn what agencies really need when it comes to planning content strategies, hiring and managing writers, and delivering quality content in the most efficient way possible.

However, it wasn’t just me! At each of my last three companies, I’ve been extremely fortunate to work with such smart, creative, and passionate people. I would be nothing without all these people and they have taught me a lot along the way.

Q: What plans do you have for Zerys?

A: Our goal is to become the largest and most widely used content marketplace platform in the world. I know that’s an ambitious goal, but we’re making progress.

We recently launched the ability for writers to sign up in 33 countries around the world. Users can now choose to order content from writers in specific countries that speak specific languages (local content buyers usually only want writers that live in their local area).

We’re building relationships with top agencies all throughout Europe and those agencies are helping us to build local writer networks in each of their countries.

Also, in the next few months, we will be expanding our model from being just a “Writer” marketplace, and will become more of a “Content Services Marketplace.” This means that very soon, Zerys for Agencies users will be able to hire any content-related labor they need along the way as they plan and execute their clients’ content strategies within Zerys.

This includes keyword researchers, title developers, editors, and even project managers, right from within the Zerys platform. This will allow agencies to reduce their overhead, and scale up their businesses in ways never before possible.

Q: What’s your favorite part of working in the marketing services and agency business?

A: Being a part of an agency these days gives me the opportunity to help, in some small way, shape an industry that is changing literally every day. I love getting up and being able to design new systems that have never been built before, to make people’s lives easier.

When an agency tells me how Zerys for Agencies has completely changed their business and their lives, it makes all the blood, sweat and tears all worth it.

Q: What advice would you give to those heading out on their own for the first time?

A: Keep your business model ultra-simple to start. Some of the most lucrative models are the simplest. Having too many choices makes it harder to sell since customers can’t get their head around the pitch.

Never follow too rigid of a plan–if you don’t know where you’re going, you can never get lost. Always be ready and willing to shift your model on a dime if need be. Don’t hire people based on their resumes—hire based on their will to succeed—everything else can be trained.

Above all, follow your heart.

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