Geniuslink and Kit com Jesse Lakes Acquiring Companies #Best Education Page #Online Earning

hey what's going on stop cutting tenir

and in this video I talked to Jessie

Lakes from genius link again and this is

pretty cool

genius link has acquired a company and

actually I was kind of surprised that

Jessie was talking to me if he is

running a company that acquired kit.com

so that at the time that we recorded the

interview it was not public yet so I

felt special you know that actually got

some information ahead of time but

anyway it's public now people know that

genius link has acquired KITT and in

this interview I learned about like why

they acquired them why they've acquired

other companies in the past and just

some of the lessons learned that jesse

has gone through so very interesting

conversation I mean I do affiliate

marketing I have a very small team

Jesse's running a bootstrapped company

so they're not going after like I got

startup kind of money or anything like

that venture capital or anything of that

sort

at least at this point in time but it's

a completely different world completely

different world so it was very

interesting I think you'll enjoy the

conversation as well and you may be able

to get some you know thoughts I know a

lot of the audience out there are

affiliate marketers so you may get some

ideas about how you can take similar

ideas about acquisitions and building a

company from pieces of you know other

areas right buying other companies so

that you can like grow larger and be

maybe more effective in whatever it is

you're doing so whether you have like an

agency or whether you have a bunch of

affiliate sites or one affiliate site or

whatever your situation is you may be

able to find some parallels so you find

it valuable

I hope you do find it valuable thanks

again to Jesse I'll put some links for

genius link out there and let's send it

to the interview now

going on Doug Huntington here from the

site project and welcome to the Doug

show I'm here with Jesse Lakes again

from genius link how's it going it's

going really well thank you today we are

going to talk about some CEO level stuff

and some scary entrepreneurship things

at least it sounds scary to me we're

talking about acquisitions and how and

why a company would want to do that and

Jesse is very qualified to talk about

this so can you at first tell us just a

little about genius link just the you

know the two sentence version and I'll

refer people back to other episodes

where they can learn more and then we

will launch into the acquisition stuff

but yeah what was genius think about

sure so we call ourselves an intelligent

link management platform but kind of the

big value-add probably it's gonna

resonate most with your audiences uh we

help websites publishers creators take a

single Amazon link and make it work

across all of Amazon's global

infrastructure of fifteen different

store fronts and fifteen different

affiliate programs perfect and

genius-like has acquired a couple

companies at this point so can you just

talk about that I mean for a lot of

people just having a company and a few

employees seems kind of overwhelming it

sounds like to me it is overwhelming no

you're you're absolutely right yeah I'm

sorry to interrupt you with that need to

emphasize that point you're at your 100%

spot on there so it sounds overwhelming

and then it sounds I would say bananas

to acquire another company especially a

couple of the ones that we're gonna talk

about today so what what brings you to

the point where you're thinking hey I'm

gonna try and buy another company and

integrate them together so for both of

the opportunities we've had they really

were opportunities you know we we're a

bootstrap startup we don't have really

rich people giving us lots of money the

money that we have is is money that you

know we had to work really hard to and

it's we made a conscious decision to

keep it in the big account of the

company instead of you know putting it

in our

pockets my co-founders and my team and I

so yeah it's we we we do it because we

think it's it's the right move it's it's

really the right opportunity where you

know you see other companies that are

you know especially right now in the

news you're hearing about companies that

are buying up other smaller companies to

create moats and create leverage and

kind of keep their competition at bay

and that's that's not why we've done it

and you know I'm sure there's a million

different reasons why you would do an

acquisition but for us it was really the

the right time the right place the right

opportunity and the piece is really kind

of fell together all that being said you

know we we had our 10th birthday not too

long ago and we've done two acquisitions

so we don't move fast but we move

targeted where were strategic I guess

awesome now it sounds like one of them

was sometime in the past but one of them

is I'm not sure the ink is even dry yet

so can you mention the latest

acquisition here yeah yeah so um we just

an acquired kit so ki t.com it's a

fairly popular platform for influencers

and creatives to just share and curate

the different products that they love

it's a yeah we're really excited about

that the ink is dried we um we'll be

announcing it publicly well we'll have

announced it publicly by the time the

audience is listening this very cool

Congrats

thank you can you walk us through like

the process of like this kit.com

acquisition sure yeah

so taking a huge step back so before for

geo right so before genius link the

company was called geo right before geo

Riot I spent some time at Apple I was on

the iTunes marketing team and when I

first came to Apple I first came to

iTunes marketing team my boss was was

awesome super helpful onboarding mean

she wasn't super technical so she

introduced me to this woman on the team

I was doing more of kind of a partner

marketing side and her name was Camille

and Camille was crazy helpful much more

technical than my boss and really helped

helped me feel at home with the iTunes

team and really kind of helped take on a

lot of the challenges that that were now

my responsibility so cumulant I started

off having just this great relationship

she she

with iTunes for some time and she went

to Google YouTube and then off to off to

Europe for a bit but then ultimately at

about 2015

I heard from her again she was working

on a start-up in New York so she had

been fortunate enough to have raised

some money I built a great team and

started working on this whole platform

and as soon as I kind of heard the story

it made made a lot of sense but that was

really kind of when kit was was created

in those early days I felt honored that

she reached out to me because she knew

that affiliate was gonna play some role

in that and she again knew my affiliate

excitement from from the iTunes days so

we chatted a few times early on and then

as they kind of start to progress the

platform we were fortunate enough to be

be chosen as their vendor to help

globalize their Amazon links so we had a

pretty close relationship there because

that was one of their main revenue

streams I was running through our

platform we had the relationship so

really was able to kind of watch you

know from from the front street or from

the front lines of kit you know really

grow and do some some really cool things

unfortunately the team put a ton of

effort into it they built what I think

is an amazing platform when you're

venture-backed you're kind of you play

in a very different game than what we

were playing you know kind of being

bootstrap kind of doing it in our own

pace so unfortunately raising a seed

round is a challenge but raising a

series a is a real significant challenge

as I understand that pieces didn't quite

work out but thankfully patreon the good

old patreon was was there and did a

hired hired up the or sorry

bought up the kid team and the kid asset

so patreon took it on a little over 14

months ago and that the site ran

unfortunately though we were seeing that

it wasn't quite getting the love that it

got before

so again had that easy proximity to

Camille was able to reach out have some

conversation she was she was pretty busy

at first but we're able to really kind

of connect and in December we just

started the conversation you know what

what would it look like to you know for

us to try to give kit uh uh home um and

it was you know we again who's strapped

company we don't we don't have a ton of

money we try to put money in the bank

when we can but we we invest a lot of

our money back into the team

back into the technology to continue to

grow so it was it was a bit of a an

awkward conversation of yeah you guys

played you know with lots of zeros and

in those early days yeah we don't have

those zeros but again we have some

really cool technology our audiences

overlap we work with a lot of creators

as well you know obviously the

technology overlaps as well you're using

our technology as a monetization

platform but what would this look like

so it was it was a slow start the

conversation there were some different

stakeholders that kind of had to be

brought in but does it really kind of

started coming together we we saw

opportunity um it's a kit has huge

potential hopefully we can get it there

but it's we're not in it to make money

off of it we're we're in it because we

think the platform's cool we think it's

very complementary to what we do and we

love the audience so anyway I'm going

off on a tangent here give me give me

back on track no that that's amazing so

you had a relationship with like smart

people from the Apple days and it sounds

like people that get into Apple or

usually doing interesting stuff and they

progress and there they meet other

interesting people so it's amazing so

this was about like just the

relationships that you had and just

understanding like the good overlap of

the audience and that sort of thing and

it's you know if there's one thing if

there's one lesson that I can take out

of it from where we're at right now it

is about those relationships it's about

you know giving maintaining helping you

know I spent hours talking to Camille

early on about what I understood about

the Amazon affiliate program and just

affiliate marketing in general and you

know that hold give first mentality you

know thankfully has come back and and

you know paid off in a significant way

but yeah network helped people just stay

connected and opportunities will will

appear interesting well I have a other

like probably off-the-record questions

that I'm thinking or like integrating

the two companies together and like the

employees like how do you deal with a

change management there have you I mean

you had some experience but what you're

playing here so honestly we've never

actually we

both the acquisitions we've done we've

done an asset purchase so I'm not a

lawyer there's two different types of

purchases here right you can you can

acquire the company or you can acquire

the assets when you acquire the company

you're taking everything with it

including the team including the

liabilities the equity etc or on the

flip side which is what we've done twice

now is we will buy the assets and

typically you're buying everything from

the company so the company is

essentially nothing's left you grabbed

it all up but you're you're switching it

over into a new holding company or new

company or whatever it may be so i I've

never had the privilege the pleasure the

the challenge of bringing in a new team

and and ingesting them into the genius

link team maybe someday but it's that

sounds like a significant challenge so

taking a step back one of them when kit

I'm sorry when Camille and I were at

iTunes itunes had just done an

acquisition of toys facing out the name

now but it was a it was a music service

this is 2010 2011 but it was a music

service that had a pretty pretty huge

fan base and it was really kind of

interesting to see how all of a sudden

all the conference rooms in our building

were full of this other team they've

been integrated over and it was kind of

a sad story to see that over the next

year 18 months more and more seats in

this conference rooms were empty and it

just I think you know I I love Apple I

drank the kool-aid you know they've

they've been great partners for us but I

don't think they managed that

acquisition as well as they could be

from kind of that human capital

perspective you know putting people in

fishbowl conference rooms and asking

them to work there for days weeks months

I could see that not being the ideal

situation for for people that had just

left a startup that was they were quite

passionate about yep sorry for the

tangent no no well I'm about to go on

one here to like the other thing that

happens I mean it's tough I don't know

how to manage in I would say you're

lucky that you're not putting yourself

in that position where you have to like

you know lay off good people that are

doing good work because basically what

happens is you have two teams

there's redundant jobs and then what do

you do you don't need like three people

to do the same thing and the value for

the company could be to consolidate

but what I was gonna say is I've been I

guess my career timing has been poor

so I guess no fault of my own but

basically I've had some you know

downturns there's always recessions or

whatever but was it a job where I had to

lay off most of the team you know

they're like hey you know lay off most

of the team and then you know what they

do everybody look out for this then they

lay you off they make you lay off your

team and then they come for you and

you're thinking hey I'm alright they're

having me

lay off the other folks so get ahead of

the curve I would say yeah get out of

there because it's no fun to lay off

someone at all and make make your boss

let's do it so we've uh yeah that's the

hardest thing I've ever done with genius

link is we had to lay a couple people

off about a year ago and not that sucked

yeah it's it's such a I think it was

harder from honestly than the actual

person but I made a promise I hired this

person and now I have to tell them that

I can't honor that promise that just

yeah that really ripped me apart so yeah

lay officer they officer challenge

better to operate as lean and as scrap

as you can for as long as you can yeah

it was an ego thing you know early on in

my entrepreneurial days I wanted to

build the team as quickly as I can you

know I say we're a team of 11 and you

know I say that proudly now but before

it's like oh you're a team of 18 or 20 I

want to be that big I want to be that

cool and yeah don't don't over hire

that's a recipe for disaster

yeah so yeah it's so tough like you said

at some point it's kind of it's a little

ego coming into play but yeah okay so

you're not having to manage like

integrating teams it's just the assets

so in this case it's like the website

and the technology and software behind

it mm-hmm okay yeah any other SAS assets

like any physical stuff or is it all

just like it's all digital

yeah which pros and cons but there was

some stickers and some matchbooks those

are those got handed awesome some swag

so I guess that was the physical side of

it but yeah it's all it's all digital

the flip side though to be honest is um

the brain trust you know software is

written in us

cific way by a group of people that

think and operate in a specific way and

it's really challenging to look at some

code and start to understand and piece

those together so the patreon team has

been amazing and working with us and

really helping transition that but we

know that we designate a certain amount

of hours that we get of their help

before you know this is done and those

hours are up it's it's going to be hard

we're gonna be on our own they've really

been great training wheels to help with

that but they've yeah they built a

really full tool there's a lot of

different aspects to it so there's we're

getting ourselves in uh in pretty deep

here I'm sure we're gonna be surviving

I'm sure it's gonna work out fine but

there's a that brain trust is definitely

one of the big benefits of bringing

bringing some team with you interesting

now getting into like I guess how it's

gonna operate so you have this new asset

it stands alone and it's using genius

link so how are you gonna like grow it

like what's the plan here so you have

two different things that are operating

independently yeah so the first we get

we have to get the asset to a point

where it can be break-even its llaman

--it ization was not their focus they

were focused on growth which makes

perfect sense that's what VC based

companies do

we're not vc-backed we need to make sure

this asset can hit break-even as soon as

possible

so kind of the first focus is taking the

genius link team you know leaving some

people to ensure that genius link

continues to grow but we need to take

the bulk of the team and reduce costs

and and make sure we're not leaving

money on the table but that's again

that's kind of the core of what genius

linked to us so that was again why this

opportunity is so interesting for us is

some optimization applying kind of our

smarts this platform we think we can do

both those things relatively quickly

once once those pieces are there once

we're breakeven then that's kind of the

Phase two okay it would be you don't

have to answer this too specifically but

like as as it stands now with the number

of say users on kit and the number of

purchases that you see as a trend like

is it just a matter

of refining things down distilling them

so that you don't have so much waste and

there's enough users to convert that

over or do you have some growth to do

before you can hit that break-even point

so the growth is happening organically

that's one of the really cool thing

again they they built a platform that

that just grows itself which is amazing

that they I can't say enough how how

creative a job ADA it's a free tool

which I think definitely helps that so I

can't you know I don't want to downplay

what we've done with genius link but the

site continues to grow there's more

traffic there's more users coming on

costly and there's there's some real

challenges though if you you know I

don't want to point fingers but yeah you

go in you have three different options

on how to sign up unfortunately one of

those three options is completely broken

it has been for some time so just you

know fixing some of those basic

low-hanging fruit of that functionality

so that again that interest that intent

can go to interest and can be executed

upon with minimal friction now those

aren't really going to be the projects

that we're gonna focus on relatively

early on so be able to sign in with with

any of the different yeah single sign-on

services that you like to use making

sure that pages load efficiently

unfortunately spent some downtime the

site has been loading really slow so

just some database optimizations making

sure it's on the right infrastructure

you know genius link we have some some

enterprise contracts with some some big

names so we need to be crazy over built

to ensure that our links are always

resolving you know how to set up times

you know is where we need to be so

moving them to our infrastructure that's

already essentially paid for yes it'll

add a little bit below but we're really

good at managing that our background is

in web hosting so there's some pieces

that are worth again we have the right

opportunity the right time the right

pieces just kind of came together but

I'm going off on a tangent now again so

ya know it's super cool like

understanding the advantages that you

have and the experience on your team

where it's like oh there's there's such

a good opportunity to like optimize some

things and it sounds like through the

path that kit went through it's like the

the value was an apparent externally but

you have to have the right team

like yours to come in and patch the

holes and take a different sort of

perspective I guess like you're like you

said your bootstrapped you don't have a

bunch of money to like grow and you

don't need to you just need to optimize

what you have there

so exactly yeah yeah for a VC then you

see 100x return for us we just need to

see the site being profitable and then

we're great yeah so that's a massive

Delta between what their goals were and

what our goals were and it's yeah for

the end creator for the end consumer of

the site yeah as long as it's working

well it doesn't it matters less them

obviously they want to make sure it's on

unstable footing and sustainable but the

end of the day I think we've got we've

given her to get home with yeah exactly

that our foot our expertise they're

their problems where are our solutions

interesting and like for I guess like

going back you obviously made the choice

that you wanted to bootstrap you didn't

want to have the VC back you didn't want

like too many investors it sounds like

he kept pretty like everything pretty

tight what made you what what steered

you in that direction versus like going

bigger yeah so again ego plays into this

to some degree let me take a step back

so we first grew up we were really

fortunate that um this the the service

was you know we didn't take money for

the first year we didn't pay ourselves

for the first year you know just coming

off of Apple jobs we had a nice bank

account that was it was great so we were

able to we were seeing money coming in

after a year of really kind of push on

GRI so this is you know 2012 ish it was

it was a parent debt with a little bit

more work we could actually start to

take take some money from it and it was

gonna be enough to pay us life life was

going to be good so because of that

ability to kind of have built something

nights and weekends in the time prior

but then be able to kind of come into it

and be able to pay ourselves you know it

wasn't nearly as much as what apples

past but was enough to live on we were

we were comfortable I think kind of set

us up in that that mentality that okay

this this works you know if we work hard

we can pay ourselves and we can have fun

so we really kind of lived in that cycle

for a while and it's yeah my co-founder

and both my co-founders my wife is one

of them my best friend growing up as

another they have great engineering

chops they're they're very technical so

having those expertise and be able to

work on things early on I think really

kind of saved us when you have a

co-founder our two co-founders that

don't have the technical aspect they

need a hire an engineer engineers are

not cheap yeah that's that's I

definitely understand why my startups

need to go the VC route and bring it but

again we were kind of blessed we had a

model that worked it really kind of

helped us out that all being said we

definitely were growing at a decent clip

for quite some time and there was ups

and downs we've had we've had crazy a

you have heard told you some of these

stories and now in a month we've had

revenue disappear by 50% multiple times

in our past but we we had hit a

threshold where we thought we were doing

pretty good we kind of plateaued a

little bit so we actually applied to an

incubator and I spent the early part I

think it was 2016 the first three months

2016 I flew down to San Francisco I live

in Seattle food on a San Francisco every

week to attend this this incubator know

incubator really kind of was focused on

getting you in front of VC so yeah we

told the genius link story in front of

50 60 VCS and had some really good

conversations since we could follow ups

but what was interesting at that point

is that we had a decent chunk of change

to the bank we'd been really fortunate

to be able to put some money aside and

we didn't need the VCS money we just

wanted their their help and their

expertise so one of the things that we

were taught is it's all about smart

money but we also decided we don't need

the money we just want the smarts so we

you know put together kind of this

advisory board kind of built this group

of people to play the vc game play the

angel game no no startups really well

but yeah give them some equity in

exchange for some help direction some

some adults to kind of keep us keep us

on the right path but anyway yeah it's

it's been fortunate off that to date

we've always been able to

girl the team do what we want to do

without asking for other people's money

I've never had a plan where I felt

comfortable asking for a million bucks

or two million bucks to do something

because I know that we've got the money

we can do it ourselves in that amount of

time and it's easier yes I've got some

advisors to help you know check in on me

but it's easier for me and the other

Jesse and for Shanna to make the

decisions about how to go so anyway

again long-winded responses no that's

perfect I mean it's it's so interesting

like I identify well because I it's nice

not to have to answer to someone so I I

hear like obviously you want the help

and the knowledge from experienced

people that have seen whatever it is

you're dealing with before maybe they

can introduce you to people I like I

don't know what all the things an

advisor does but you know at the end of

the day it's like if you want to do a

thing or change the direction like you

the three of you can figure it out

sounds like absolutely so very cool well

anything else to add around the

acquisition or you know if people are

sort of in the position they're like ah

I'm thinking of maybe acquiring either a

competitor or some other complementary

company what advice might you give them

as hard as it is try to keep emotion out

of it again you know it's it's really

exciting to say oh yeah we acquired this

company out that's as founder is right

you know kind of the acquisitions the

exits those are kind of those are the

milestones that are most exciting and

most important so you know you spend all

this time in the weeds you know pushing

and pushing and working working and then

this this whole you know acquisition

exit whatever whatever you want to call

it or whatever side of that excitement

you're on make sure that you don't get

too tied emotionally into that because

it's unfortunate that you know you can

start thinking with your heart instead

of your head and pieces can come

together and things can you can get ugly

and interesting fast from from what

we've seen so be logical way both sides

of it don't you know do your pros and

cons list do your do your gap analysis

or how ya put together those notes the

spreadsheets make sure you're talking

this out don't make these decisions you

know on your own help get a good tip of

group of people to help you out an

awesome lawyer is a huge benefit because

they see things in a very different way

than at least I see things so yeah just

just be prepared to to walk away that's

also gonna make you a better negotiator

at the end as well very good awesome

advice Jesse really appreciate it

Congrats again on the acquisition thank

you and we will have you back on soon

really appreciate it

absolutely looking forward to it thanks

doc thanks again to Jesse and I will put

links for Jimmy's link and kit com of

course do check those out and if you're

brand new to the channel thanks for

checking out the interview have a look

at some of the other videos I often talk

about Amazon affiliate marketing

internet marketing in general keyword

research that sort of thing sometimes

there's some random vlog and travel

videos as well so if you like what you

see please subscribe hit the bell for

notifications and all that business so

we will catch on the next episode and

thanks again to Jesse and genius link

out there

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