This right here is a graph showing revenue over time, since we started one of these projects. And yes, I confirmed you’re looking at multiple six figure months. But who is we? I’m talking about LeadSpring, my SEO business. You see, LeadSpring used to have what we call LeadSpring Launchpad, where we’d partner on your existing website, take over your SEO, and then split the additional profit we created for the site.
Which is a good model, but wait till you hear the optimized version of it. But first, let’s rewind back a couple of years to the Chiang Mai SEO conference. With 800 attendees, most being high level SEOs and entrepreneurs, you can imagine there’s a lot of networking and a lot of deal making going on. An SEO buddy of mine hits me up and says, in more words or less, “Hey, are you free for a dinner tonight?
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“I have a huge business opportunity “I’d like to share with you.” And I was like, “Well, I’ve got a lot on my plate.” And he was like, “I’m buying the drinks.” I’m like, “Okay, what time.” My team and his team went to dinner at this fancy rooftop bar. I ordered only the most expensive cocktails, of course, and we enjoyed a fine meal. After the foreplay was done, he hit me with the pitch, “I own this real estate agency “and I’m doing the SEO lead generation myself.
“We make 17 million per year. “I want you to take over the SEO, “so I can focus on converting these leads “and selling these properties. “In exchange, I’ll give you actual ownership “of the business. “You’ll have stock, equity, a percentage in the company. “If you can take us from A to B, “we’re gonna make a (beep) ton of money together.”
He had my attention, the numbers had my attention. I still had some important questions on my mind which I’ll share with you later, but I was down to sleep on it. We eventually started to partner up, so let me tell you how that went.
First It Was A Slag
Not gonna lie, at first it was a slag. Bear in mind, the website we were starting with was in it’s baby phases, and we all know you need to be patient with SEO. But to make matters worse, real estate leads do not convert quickly. If someone says they’re interested in a home, it doesn’t mean they’re gonna buy it today, plus you gotta wait for loan approval, escrow, and sometimes buyers get cold feet. Patience was a requirement. But if you do good SEO, eventually you start to see some results. Here’s the traffic growth over time on this project. And as you can imagine, cash flow followed suit.
The thing is in terms of SEO, it’s not the hardest niche I’ve ever been in, not by a mile. I’ll make an SEO case study of this project, so make sure to subscribe so you don’t miss it. But for now, I’m gonna show you how you can create deals like this for yourself and why you want to. (air whooshing) We’ll get into what kind of businesses are ideal for these partnerships, how to entice them to do business with you, and the various types of deal structures you can and should make.
Stick Around To The End
Make sure to stick around to the end, because there’s some pitfalls you want to avoid as well. Now, before I jump in, can I please ask if you’d stop avoiding the like button, give it a gentle smashing. Smashing the like button is a win-win, it helps my channel out, sure, but it also helps the YouTube algorithm know that you like content like this. So, thanks. I recently learned that there’s a name for this type of joint venture marketing partnership and it’s called the smart agency model. I agree, it’s smart, but the agency part, not so much. You’re not working with a client, you’re working on your own business. Anyways, we can’t win them all. Let’s talk about some of the benefits of the smart agency model.
Specialization
First off, it allows you to specialize, which is SEO and marketing. They focus on actually running the business. Just like how I’m sure most affiliate marketers have thought, “Duh, “why don’t I just start selling my own ping pong tables “instead of making a commission of 2% on Amazon.” They eventually back down, because who wants to learn eCommerce?
SEO is enough by itself. The smart agency model takes care of this. Next, you never need to worry about EAT, expertise, authoritativeness and trust. Google has said in their quality rater guidelines that they’re looking to promote articles that have been written by trusted and authoritative subjects in each industry. This becomes challenging if you’re trying to create a website in the finance niche and you’re just some bro hanging out on Reddit’s Wall Street bets.
Smart Agency Model EAT
But with the smart agency model EAT isn’t a concern. You’ll be partnering with the industry experts with degrees and everything. The third benefit is that in many cases, you won’t have to be responsible for the content, which is a cost savings. If you partner with a surgeon, he’s not gonna let you write up some content on the latest tumor extraction technology under his name. It’s within everyone’s best interests that they take care of the content. You still need to optimize and SEO it though, Thankfully, with tools like Surfer, 99% of the optimization is done in the writing phase, bam.
The last benefit is the big one. Unlike typical agency work, you actually get to participate in an exit event. If your partner gets an offer to sell the business for 10 million, then you get a piece of the pie too. You can sell affiliate marketing content businesses as well. At the time of this recording, multiples are about four X times annual profit. So if you have an affiliate website making $10,000 per month, then you can have a $480,000 exit. But if you smart agency up with a SAAS business, you’re looking at a 10X on annual revenue. So if you’re making 10X per month in revenue, which isn’t that hard, you’re looking at a $1.2 million exit.
What Kind Of Businesses Are Great Partners
Now, let’s start to talk about what kind of businesses are great partners for the smart agency model. Ideally, you want lucrative, but non-competitive niches. I know, right about now you’re like, “I also want a gold Lambo.” But this is actually achievable with smart agency. You just need to go local. Instead of trying to compete nationally for something like plastic surgery, just try to rank in one city. A liposuction surgery in Austin is about the same price as in Los Angeles, so choose your battles and find the best ROI. eCommerce is another angle.
Trust me when I say that there’s a lot of easy gaps to fill with eCommerce SEO. As for how to actually do the SEO for the smart agency model, make sure to subscribe so you don’t miss the case study. By the way, I’d like to give a huge thank you to the sponsor of this video, (air whooshing) and that’s Ahrefs. Ahrefs is an all in one SEO tool that many search engine optimization professionals, including myself, use to get their job done.
It really does do more things than I can count, but for me particularly, I use it for site audits, which help me evaluate the technical SEO health of my websites, so Google will love them. Competitor research. In particular, reverse engineering the keyword research and backlink strategies of my competition. And content explorer, which helps me figure out high search volume, low competition topics to write about. This kind of data is absolutely critical for doing SEO these days, (air whooshing) and it’s nearly impossible to get by yourself. And best of all, just because you hit the like button, Ahrefs is offering a free version called Ahrefs Webmaster Tools or AWT. Just go to ahrefs.com/awt to check it out today.
How To Land On Deals
Now, I wanna share with you how to actually land these kind of deals. Like with anything, it all starts with having a good reputation and track record. You wanna be known as someone who’s proficient and gets the job done. (air whooshing) You get that by being good at SEO and collecting case studies about your work. Make sure to check out my SEO millionaire habits video, which includes essential tips, like networking and personal branding, after you watch this video. Now, there’s two different approaches to finding partnership opportunities for smart agency.
The first is actively, (bubble popping) where you’re actually putting in effort, and the other is passively, (bubble popping) where you’re letting the opportunities come to you. Let’s focus on the active approach first. Now, when I say active, I don’t mean go out and start cold emailing businesses one by one. It’s gonna go like this. “Hi, I’m the 30th SEO business who is emailing you today.”I don’t just wanna do SEO for you, “I want a part of your business. “Oh, yeah, my name is Matt. “What’s yours?” In the rare case that someone actually responds, you won’t have much bargaining power as you came in cold AF. Instead, think outside the box.
Call Up Some Small Business
Call up some small business M and A, that’s mergers and acquisitions law firms, and tell them what you’re looking for. Show them your track record and they’ll do all the hard work for you. They know a bunch of small business owners already. They want commission for putting together the deal. It’s in their best interest to match you with someone that needs this kind of scaling. The passive approach requires you to have some level of influence, whether that be through a blog or social media, you wanna have a level of renown to the point that deals are coming to you. This is one of the main benefits of having a personal brand. And I’ve always been tripped up over why some people have a great rep for being capable SEOs, haven’t made deals like this. I’m looking at you.
What Types Of Deals You Can Make
Now, let’s start to talk about what types of deals you can make. I’ve told you that this is all about getting a share of a business, but how much is fair and how should you structure the deal? Let’s say you decide to partner with a CBD company. When they sell a bottle of CBD on their website, they get paid instantly and the product gets sent out. So if you started to take 15% of that business, you’re essentially getting money on day one of working with them without doing anything.
In these types of situations, expect to have a trial period, where if certain milestones are met, such as an increase of 15% traffic, then your 15% equity kicks in. This is called a waterfall. Don’t go chasing waterfalls. If instead you’ve made partnerships like I have, where the businesses rely on lead generation, such as with the real estate business, then structures are more straightforward
Partnership Start Date
On the day of the partnership start date, all leads going forward are 25% yours, for example. The downside is having to wait for the cashflow to start coming in. There’s ways to get money up front, though. If you want some cashflow to help with your SEO machine, you can start taking a draw of 15 grand per month (bubble popping) that would offset the future earnings. I know we’re getting super nerdy with the financial jargon, which is why it’s always good to get some M and A attorneys involved to watch over the deal. Which brings me to pitfalls.
What Could Go Wrong?
You’re merging with another business, what could go wrong? I hate to look at things pessimistically, but it’s really in your best interest to write your shareholder agreements and other documents as if you’re preparing for the worst. That’s what these documents are for. They give you a playbook on what should happen if the worst possible situation comes up. Or as one of my partners said playfully, “In the event you guys developed heroin addictions, “here’s what would happen.”
The next pitfall is you might not find a partner that’s as hungry as you are. That’s why it’s always good to run a six month trial to see what it’s like working together. You don’t wanna be putting in 500% when they’re putting in five. Another pitfall is they might not be able to scale as fast as you can. Here’s a good question to ask in any meeting. If we are able to 10X your traffic in six months, could you scale up to meet the demand? So what’s my feedback so far after trying this model for quite some time now?
I love it, for all the benefits I mentioned earlier, especially the fact that I can just focus on SEO and traffic and I don’t have to worry about EAT ever. I like it so much that it made another one of these partnerships with a law firm, where hopefully we can start seeing some seven figure months once the pipeline is built. And we’re also looking to add a new smart agency project to the mix in the software or eCommerce spaces.
