Larry Kim, founder of WordStream and CEO of MobileMonkey, has seen it all in the world of digital marketing. Starting from being a budding marketer, he has now grown multi-million dollar companies and is still going strong. In this interview, he shares his knowledge and experience to fellow marketers.
How did you start out as a marketer?
My background is in electrical engineering at the University of Waterloo. I spent most of my time writing software to automate repetitive tasks. At 25, I was doing search engine marketing consulting for various companies, and the work involved the same repetitive tasks like keyword research, keyword grouping, rank checking, bid management, and so on.
I saw an opportunity in making digital marketing more efficient, helping business grow by more effectively capturing leads and sales with less effort. In 2008, I founded WordStream, which has now become the world’s leading PPC advertising software provider with over 200 employees and 10,000+ customers worldwide. I sold the company for $150 million in cash.
Looking back, what was your hardest struggle when it came to delivering results?
Overcoming your fears is one of the most difficult challenges in starting a business. There’s discomfort and anxiety throughout the process, fueled by not just the fear of losing all of your money, but also of failure. All you can think of is that everyone will see you fail.
Another struggle is finding people who are just as passionate as you are about your idea. Such people who will jump right in with you are rare, and all they have at the start are the potential of the idea and your word, especially if they have to quit their current job to join you.
But as you get more wins under your belt and your business idea starts making money, more people will eventually join in on the craziness.
How did you get your first client back then, and what kind of service did you do for them?
Referrals, referrals, referrals. Search marketing was fairly new a decade ago, so it was harder to find people in the past. Nowadays, whenever you Google search terms like AdWords, keyword tool, or link building, you’ll likely see me pop up in the results.
With WordStream, we spent a few million to develop it and we had a few hundred customers. However, the churn was at around 25%. We realized later on that since keyword research is a one-and-done sort of task, we don’t retain customers who get what they want from our product.
For me, it was simply a tool for automating my workflow. But for 99% of the market, it’s something they barely understand. Even if it made keyword research easier and more convenient, it was like ten times more complex than Google Keyword Planner in terms of organization and classification of data.
I wanted to retain customers for three to five years, but they were just sticking around for three to five months. Upon realizing that, we knew we had a problem. We had to diversify.
What do you find most rewarding about what you do?
My main motivation is the desire to create something useful that can help others and not wanting to let them down once I give them my word. I get a kick out of helping other entrepreneurs grow their businesses, as well as creating more job opportunities.
I’m inspired by many people to do what I love doing.
My customers motivate me with their trust in my company delivering products and services that make their online marketing simpler and more effective.
My employees drive me with their talent and having their livelihood rest on my shoulders. After all, job creation is one of the big things I do this for.
My investors hold me accountable with their investment of millions of dollars into my company, looking forward to my promise of bringing them big returns.
And last, but certainly not least, my family—because I love them.
We have a lot of readers who are bent on becoming freelancers, aside from freelancing, how else can someone earn online, and what is your advice?
At the start, the best thing to do is to carefully assess your motivations. Ask yourself why you want to start your own business. Is it to be your own boss, working at home, making money from following your passion, or so on?
That’s because when you’re starting your own business or freelancing career, you’ll have a lot of misconceptions of what it entails. If you’re thinking you won’t have to work as much and you’ll have more time to relax, you’re in for a rude awakening.
To dampen that initial shock, it’s important to set a base strategy. It may need some changes as you progress, but you won’t need to make huge course corrections as long as that strategy is mostly sound from the beginning.
Be brutally honest with yourself. Don’t overestimate the novelty of your own ideas and don’t downplay your competition. Be picky if you’re just starting out and go all in when you encounter that unicorn idea that’s remarkable, differentiated, and special.
Finally, be great at a specific thing and don’t rush it. Trust in the process.
Can you tell us about a time where you had to put in significant effort up front and then wait a long time for success?
Starting from nothing is tough, no matter what you’re in. You have to shoulder everything, from bringing together a team willing to work on a viable product to marketing it to your target customers. You lose sleep and precious time with loved ones.
In the early days of WordStream, we pitched a product that didn’t seem to have the traits needed to be successful and sustainable at that time. We had to rethink what we were going to sell, and we eventually pivoted to selling PPC software, which was similar, but substantially different from our first idea.
Compromises and tactical changes were needed along the way. Iterations and testing are part of the process, and you soon favor keeping what’s most useful and throw away what’s not useful. The final product tends to not turn out exactly the way you first envisioned.
What recently-developed marketing strategy, technique or tool interests you the most right now?
The future of social media will be all about chat marketing and stories. If you’re not doing those already for your business, you should do so right now.
Messenger marketing is so compelling to me that I founded a company for it. If 80% open rates, 20% click-through rates, and 10x lower cost-per-leads via Facebook Messenger ads doesn’t compel you too, then I can’t help you.
But if you’re thinking of automating your Messenger marketing with a chatbot, then MobileMonkey can definitely help you with that.
Can you tell us about a project you’re most proud of from your past work history?
I’m happy and proud of what I did with WordStream. It was a small company I started in a Panera Bread during my 20s and grew it to over 300 employees and tens of thousands of customers. It now manages over a billion dollars of ad spend.
While many other search engine marketing software companies either went bankrupt, sold for next to nothing, or are now on life support, WordStream actually became successful.
I learned a lot from starting and growing that company. It has been an incredible journey so far with over a decade of helping people grow their businesses.
Which one book/blog post would you recommend every Marketer should read?
Zero to One, by Peter Thiel with Blake Masters is a fascinating read. Whether you’re an entrepreneur, manager, or executive, you’ll learn a lot from it. It dives deep into how Silicon Valley works, and you’ll pick up concepts that can be applied to all aspects of business.
What advice would you share with other Marketer’s who want to become more productive?
In my over ten years of growth marketing experience, I learned that when you find your unicorn growth hack, you should squeeze every last bit of magic out of it.
Also, if your business has customers who know exactly what they want but don’t know where to look, go for Google ads. If it sells more to specific audiences, go for Facebook ads.
If there’s one Marketing Guru you’d recommend, who and why.
There are only a small handful of gurus I’d recommend because there are so many of them. It’s a joke just how many people claim to be experts and just parrot the same lines.
The typical advice you get from the majority of those so-called experts aren’t so actionable. It’s mostly something like “Don’t make bad content.” But of course no one is intentionally creating bad content, so what’s the point of that advice?
What they don’t say is that in marketing, quality is defined by the outcome. Your blog post may be spectacular as it generated 10 million views or a donkey as it generated only 50 views.
If I have to choose one guru, I’ll go with Neil Patel. He’s especially great at LinkedIn and video marketing and entrepreneurship.