LA Business Podcast

24. Timothy Dick, Founder & CEO, VOIPO & ProfitLayer

Timothy Dick VOIPO ProfitLayer
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In this episode, we speak with Timothy Dick, Life-long entrepreneur, Founder, and CEO of VOIPO and ProfitLayer, and 3-time Inc 5000 CEO about his many multifaceted ventures. 

Intro: [00:00:00] Welcome to the LA business podcast, a form for business owners and senior executives to share the experiences about the elements that drive their success. Your host is Robert Brill, CEO of, an Inc 500 company delivering the power of hyper-local advertising. Robert writes for Forbes, Inc and Ad trade publications.

Our goal is to bring you the stories about successes and failures of people who are making big things happen in marketing, entrepreneurship, and management.

Robert Brill: [00:00:37] Everyone. Welcome to another episode of the LA business podcast. Today we have Timothy Dick.  Tim is a multifaceted entrepreneur. We’ve met recently.

Yeah. I’m super excited to have Tim on the show. Tim, tell us a little bit about yourself and all the different companies that you are working on/in with.

Timothy Dick: [00:00:59] Sure. Yeah. First of all, thanks for having me on.  Ben, it’s been a great getting to know you,  since we met at a, at an event recently.  yeah, and right now,  I have two primary focuses.  one focus area right now is a business called VOIPO. We provide a voice over IP, phone service,  to consumers and businesses.  mostly on the consumer side actually.  and that company is about 13 years old, so it’s a, uh. Primarily like a low-ticket SAS type company.

But I always say that it’s a,  it’s kind of a combination of a sass play in terms of software in the cloud, combined with like the stability of a utility being Telecom. So that’s,  one of my core businesses and,  the other is a, a consulting firm. And, uh. Really a business development agency where we managed marketing. We manage advertising.  we work a straight sell. We, we do a little bit of everything. And our approach is basically taking a look at every business individually and,  the stakeholders in that business and all the goals and figuring out what the best combination of things are, is for them that will help them a) get to their goals, but b) suit their unique personality and natural disposition. And that business is ProfitLayer.  we like to look at things in layers because there’s really a, always so many layers to everything and you can have layers within layers, within layers.  so those are my primary,  focuses right now VOIPO go and ProfitLayer.

So very interesting.  you and, and, and prior Tim, you have been,  well you are three time,  Inc 5,000,  you write for Forbes your part of the Forbes LA business card?

Robert Brill: [00:03:25] This one? I think it’s the National Council.

Just for the National Council, National Business Council, and prior you are Senior Vice President at HostGator.

What do you think? And you have a podcast as well, which we’ll talk about towards the end. Tell us the name of your podcast.

Timothy Dick: [00:03:44] It’s just ProfitLayer, like our company name. We talk about, business marketing, a little bit of everything and really kind of getting new perspectives or even not even necessarily new, it just getting different perspectives out there.

 because that’s one of the things that really drives me is, I really enjoy digging into different businesses and,  seeing what makes people tick, you know, and kind of the psychology, you know of business, the psychology of marketing and, uh. you know, really looking at the, what everyone’s doing and,  you know, especially whenever,  you’re able to meet,  you know, like minded people like you.

 you know, there’s a, a lot of fun stuff to talk about.

Robert Brill: [00:04:36] So, you know, the goal of our podcast is to really understand how businesses scale. You know, I guess the first question is, you know, with your time at HostGator. I believe you were part of the founding group at

Timothy Dick: [00:04:49] I joined HostGator very early. When I joined HostGator,  the founder had actually, already started the company.  he had actually had a few hosting companies he had started that had failed prior to that. And then HostGator, he started from his dorm room. This was in South Florida, and things just started taking off. A lot of it was timing.

 there was a, a lot of focus on,  providing reseller services and,  really just focusing on, doing a lot of things that,  at the time,  most of the larger companies were not doing like the reseller services and really personalized support. And,  yeah, basically I had a background, in web hosting.

You know, I had met him on a message board, actually a web posting message board. You know, back in the day before, there was no Facebook or any of that. So, you know, we would,  you know, all congregate on these industry message boards.  and I had had a, you know, a background in hosting. He had already started the company. Things were starting to move pretty fast. And,  he asked me to come down to Florida and join him there. And at the time we had a, I actually didn’t realize the scope.  and I don’t think he did either. You know, what I was getting into because I go down to Florida and,  you know, I was basically being brought into help with operations, since I had a, a background in it and he was focused on really just growing the business. The company was doing a couple million dollars a year,  we had,  I’m going to say maybe like 9 or 10 employees. I mean, it was something in that range.

We were in a 1500 square foot space, running three shifts. You know, everyone, no remote employees. So, for the time that we were in Florida, our general manager, the founder and myself all shared one office,  you know, so we were, you know, we were very, uh.  very close there. And,  you know, we, we, with the growing, you know, we very quickly realized, like, as we started planning out the growth that we, couldn’t really scale cost-effectively and South Florida where we were, we were in Boca, just a really nice area to live.

Robert Brill: [00:07:45] So HostGator is like, Go daddy. Right? Like you, buy domains, right?

Timothy Dick: [00:07:53] Very similar. And except, GoDaddy actually started out on the domain side. HostGaters started out on the hosting side and now they both do both.

Robert Brill: [00:08:02] Got it. So, why would the geographic limitation be there?

I mean, I would imagine you sell nationally.

Timothy Dick: [00:08:14] Yeah. We actually had customers all over the world.  it was actually a really a high percentage of our customer base.  I, I know at one point it was a slightly more than half of our customer base was actually not even in the US, so we, you know, we did so worldwide.

 but one of the things that we were really committed to, and especially the founder, Brent, he was very adamant about providing amazing support, 24/7 in house. He didn’t believe in remote work.  you know, and back then, there weren’t nearly as many, you know, tech tools that, make that easier now, but he didn’t believe in, you know, that.

And so, everyone was in house and we could not find enough skilled technical people to hire, even for support. Because, you know, Boca is primarily a retirement city, you know, and it’s, it’s very nice. But we, we knew that, we had issues finding people. We also knew that, you know, as we were bursting at the seams, you know, with the 1500 square foot office, you know, and trying to hire more people. And so, we were looking at real estate and he, wanted to, you know, buy a property because the company was growing so fast. And I figured. Might as well, you know, not pay rent and, what for what we could get for the money.

 in Florida, this was still at the peak of the real estate market, you know, and it, we, we could get like a tiny office condo of maybe 5,000 square feet for, you know, $5 million.  and so we started looking at other cities. We ended up going to Houston. And that was a pretty abrupt.

It was about six months after I moved to Florida. I was just starting to get settled in, and then one day he’s like. What do you think about Houston? You know, and I’m like, I don’t really know much about Houston, but you know, it made sense, you know? And so we went from that 1500 square foot space, went to Houston, bought a 35,000 square foot building.

 and at the time it was like, we’ll never fill this. But it was a really nice setup because a) that 35,000 square foot building was about the price of 5,000 square foot, spaces in Florida because the cost of living was so low. There is a huge pool of, tech talent, you know, in Houston, and obviously with the cost of living being low, we had some of our employees in Florida that a relocated with us that, you know, they weren’t able to buy a home in Florida. But in Texas, no problem.

Robert Brill: [00:11:18] Even Facebook, sorry, even Facebook, I think, has their support in Texas, I think.

Timothy Dick: [00:11:22] Yeah. You know, so it was something that, you know, in Houston, we kind of planted roots there. And we just kept moving faster, you know, and at the time we didn’t, we honestly, we had a lot of things that just worked out, you know, in terms of a good timing, you know, in the industry, a lot of things like that.

But the company, you know, ultimately within just a few years, we were hosting millions of websites.

Robert Brill: [00:11:55] How did you get there? What was the impetus for the growth? Like is it purely timing? Was your service better? Was it marketing? Was a customer acquisition costs being maintained? Was it operational process, which we’re finding is happening with us and is paying massive dividends.

Timothy Dick: [00:12:11] So the biggest drivers I think we’re really, a lot of it was timing and our focus on really empowering resellers. We had a really robust, reseller programs, I believe about 40,000 resellers at one point.  and then we had an affiliate program where we were paying out, you know, we were paying out millions of dollars monthly in this affiliate program.

So, we really empowered, you know, those channels. And then, the, the focus was always on providing the best service. And. Doing what was right for the customer. And so that meant like 24-hour support, you know. So, we had a, you know, three shifts running at all times.  you know, everything was in house. We didn’t outsource any support.

 we didn’t have anything overseas. And that was kind of unheard of. There were a lot of companies that were, you know, our competitors that just, their support was okay, but, you know, it was.  not the best, or it was overseas. And you know, and this was the quality of teams, you know, that you can, that you can get overseas has changed a lot since then.

You know, because back at this point in time, we were in a time where, this was before the iPhone.

Robert Brill: [00:13:38] So what year? So, you’re talking about like 2006, 2005.

Timothy Dick: [00:13:44] Yeah. 2006 is when I joined HostGator. Yeah. So, we were moving 2006 into 2007.  and it took us a while to, to get, you know, adjusted there.

And then we just went on a hiring spree because the demand was built up.

Robert Brill: [00:14:02] So tell, let me ask you a question. You mentioned affiliates, so is it literally like, were you, I’m not particularly familiar with the affiliate marketing world. Like today we have ClickBank and there used to be Commission Junction in a few different places.

So, would you, would HostGator be the company putting offers out. And letting affiliates earn money on top of those.

Timothy Dick: [00:14:23] Exactly.  we, we had two options back then.  we did use Commission Junction, you know, and they had a network of publishers, you know, a lot of people are familiar with it. We use them.

And then we also had an in-house affiliate program where we had our own software internally.  we were able to pay out, uh. A little bit better commissions on the internal program because we didn’t have the, a 20% or whatever it was, service fee, you know, going out to Commission Junction, for it. So what we would do is, you know, people would join the affiliate program.

We would put a lot of effort and to making a ton of creatives for them, making everything as simple as we could.  even down to, you know, making custom coupons that were tied to affiliates. So, they didn’t even have to click someone’s link, they could just use your coupon, get hosting for a penny.

And we would pay a commission, because we, we found that the penny, the penny thing was something that, we found that if we discounted down to free, there was a lot of fraud. And so by charging a penny, you know, it was, kind of effectively free, but it weeded out the fraud. So someone could use your coupon code.

We would give a commission and we just got rolling everything into the company. I mean, it was something that, you know, even when, you know, we’re talking revenue in the tens of millions, and, you know, it was the founder of the company, I mean we were all still living fairly modestly.

 you know, he was probably doing a couple hundred million. Or, tens of millions, ended up being worth a few hundred million, but it was doing tens of millions in revenue, you know, approaching a hundred, you know, and he was still in about a $300,000 house.  you know, which in Texas is nice, but you know, nothing crazy.

Robert Brill: [00:16:37] I get it. I totally get you. You spend $1 million on a home, you own the whole Lake.

Timothy Dick: [00:16:44] Yeah. And it was something that, like, we just put all of the money back into either improving your service or marketing.  you know, especially with affiliates and incentivizing, and the growth really came from a combination of basically just, having that really good reputation from the level of service we provided.

 and having that army of customers and affiliates that were.  spreading the word and it, it would actually, it was interesting because. Again, you know, message boards were a big thing back then. So, we would have a lot of situations where a customer would post something negative, whether it was true or not.

There’s a lot of things that people post that aren’t true complaining, but it didn’t, you know, whether it’s true or not, someone would post something. And then there would be like an army of people replying, like, wait until we hear their side. You know, like, what’s really happened? I think you’re leaving something out.

And they were defending us and then, you know, we would get in there and we would just basically, you know solve the problem and make things right.  we were very focused on, basically service and driving revenue and profit. And not so much on image. And that was a big difference because there were a lot of competitors that, you know, they were doing a lot of things that maybe it looks good.

It sounds cool. You know buying fancier offices and, you know, doing like Superbowl ads and things like that. And we were, really just kind of in a way, sticking to the basics and just executing those really well.

Robert Brill: [00:18:43] The basics of customers service. And being a good human to other humans.

Timothy Dick: [00:18:50] Yeah. And just running the business really prudently, you know, in terms of, internally, you know, we didn’t have a lot of layers, you know, which is ironic since I deal with a lot of layers now, but, layers in terms of like layers of management and things like that. We had a fairly flat structure.

You know, we had support, support supervisors, and that was really it. We didn’t have a huge executive team. There were just a few of us, you know, we didn’t have, a lot of the bloat that a lot of our competitors had.  and we just kept everything very lean. And it was one of the things that was really interesting is just that, you know, even at a point when the company revenue was, and you know, well over a hundred million, the company was worth a few hundred million, and was eventually sold.  the founder Bret, he actually was still always very open with customers. If you have a problem and you can’t, all I ask is that you go through our normal support channels.

If they can’t fix it for you or they you get bad service or anything like that, here’s my direct email and I will reply to you. And he personally, replied to people all the way right up through the sale of the company.  you know, and so a lot, a lot of our competitors were like, is that really the most efficient use of time when you have a company, you know, doing a a hundred million dollars in revenue?

And you know, probably not. But it sure didn’t hurt anything.

Robert Brill: [00:20:35] Yeah. On a one on one is not. But the ROI in terms of what you get from an evangelize customer is incredibly valuable.

Timothy Dick: [00:20:43] Yeah. Because basically all the core, operations and the functionality that, you know, was needed for the business obviously, that was handled and systems were put in place and people were put in place.

So he kind of structured things where he didn’t have to be involved, but when he chose to be involved, it was helping customers in that way, and really going above and beyond.  and so HostGator, was, sold. It’s been like five or six years ago, to, an investment group that owns a bunch of other hosting companies and the founder of that company is  basically he has a ranch, a 18,000 acre ranch in the middle of nowhere in Texas. And, collects tanks and like army tanks and military stuff and exotic animals. And, you know, it’s like, but I guess, you know, we were, we were both really young, you know, he was, I guess at the time of the cell, I mean, early thirties.

Yeah. So when you, have a huge sell like that for hundreds of millions of dollars at that age, it’s like you’re always thinking about what’s next.  and that’s really during that time, you know, and during the growth phase, you know, I was involved very heavily with the move, and really establishing the growth.

And then over time, you know, I eventually phased out. Because Brent, the founder of that company, had actually asked me to, and really kind of convinced me to start another company. He really wasn’t, you know, it was kind of one of those things where it was like, you know, Hey, just. Will you please go start another company?

So, I can invest in it and I want, you know, minority share in it. And I just need diversification because all my eggs are in one basket. And, so that’s where VOIPO, which today, you know, as the telephone company, you know, I started it while still at HostGator, and then, you know, I was kind of phased out as we got it off the ground.

 you know, and I was just like more selectively involved, like a MNA type stuff, or really important or interesting kind of deals, you know, and stuff, I would kind of get involved, but otherwise I was focused on VOIPO at the time and once VOIPO hit the point where it was starting to really grow, I decided that,  I didn’t really care for Texas that much.

Didn’t like the heat, the humidity. And, my,  CTO at the time, uh. He, is originally from,  Anaheim here in Orange County, California. So, we were looking at some other places to move and he convinced me to move here. And so I’ve been out here for nine years. O

Robert Brill: [00:24:15] Okay, nice. And so, my understanding from our conversations is that you’re, taking some of the same principles that were deployed at HostGator.

Great customer service, focusing on the fundamentals that you deployed at VoipO, is that right?

Timothy Dick: [00:24:32] Oh, yeah, absolutely. Like we really, that was one of the things that there, there are a few differences that, you know, that we had in terms of management styles, like , like as an example.  I’m okay with remote employees.

Whereas he preferred them to be in the office. Things like that. But for the most part, yeah, I mean, I, it was really hard to, to, the look at things and, and, you know, think like, At one year, it was a ranked 57 on the Inc 500 list. So we were the 57 fastest growing company in the country, and, it’s kinda hard to argue with that.

So it’s like, you know, I was a very big advocate and learn so much.  from him that, you know, I was like, I’m not going to reinvent the wheel. You know, I’m just going to try to apply the same principles and do a lot of the same things, may do things slightly differently in some areas. But yeah, I mean, what, you know, build host here, it was definitely a, a, a gray model to be able to adapt.

Robert Brill: [00:25:45] Do you also relying on affiliate marketing for voice?

Timothy Dick: [00:25:50] We have, an affiliate program, you know, which generates a decent amount of revenue mostly from, like, comparison site. It’s like a, where people go to find like a lower cost service, things like that.  we also have a lot of word of mouth.

And, we do a lot more paid traffic because, a) we have more of a budget. You know, we started out with, you know, $1 million day one, you know, as like a budget. So we were able to get into paid a little more. And now.  I mean, really think back 10 years ago, you know, Facebook was not really a marketing platform.

You know, ad words was really the big one and a good chunk of our customer base.  I think it’s a little over 30% came directly from AdWords, so it was a combination of paid, affiliates. And, really a lot of word of mouth and slow, slow and steady growth because VOIPO is 13 years old.  you know, and we have close to a hundred thousand customers.

So that’s, I mean, that’s significant, but it’s not in the grand scheme of things. And that’s one of the things that, you know, sometimes, I get asked, you know, like, why, why do you want to stay at the size that you are. You know, or it doesn’t seem like you’re really pushing as much as you could, you know, to go, yeah.

 you know, beyond that, you know, we’re, we’re right around the $5 million range in terms of, revenue. And, you know, I’m, part of that is just that, Mmm. There’s something about growing or being part of a team that grows a company. That is like one of those rocket ship kinds of situations that, is in a way really draining.

And is also something that, you know, I just had to kind of make a decision, you know, about. Lifestyle preferences and some things that, you know, I wanted to do. And honestly, I don’t want to have hundreds of employees again. No, I’m perfectly happy with the couple dozen that I have, you know, and, we, we grow, you know, we’re slow and steady growth.

 you know, utilities, that component SAS and utility is a pretty stable. It’s all, you know, recurring revenue. So we, you know, we try to just a really, the big thing is like, help people save money on their phone service. We’re moving more into the business sector, from residential, but the bulk of it is residential.

And then beyond saving money, it’s, you know, helping,  create innovative ways for people to use the service. So, like with businesses, for example, we’re seeing a huge, huge surge and,  SMS and text message marketing,  and even like,  text message communications. And we can do things like take, even if someone’s not using our phone service for voice. Maybe they have, you know, a landline or service from their cable company and they, maybe they don’t want to change it for whatever reason. We can still text enabled their number, where they can manage those texts online and communicate with their customers.

And, it’s a really interesting thing that,  this was about,  a year and a half ago for our customer base.  we had not announced SMS or texting functionality whatsoever. Whenever we set it up, it was just mass enabled behind the scenes before we wrote it out. And the first week, and this was, no one had any idea that their phone numbers are even capable of receiving a text message. But there were, about 2 million messages in that first week that came in.

A lot of the was spam, you know, but there was also a lot of it that it, you know, people were just trying to text them and they just never knew. Cause people just assumed that you could text.

Robert Brill: [00:30:30] So Tim, are you saying that a company that provides can use your phone numbers, your voice over IP phone numbers to send text message or receive text messages?

Timothy Dick: [00:30:43] Yep.

Robert Brill: [00:30:43] So is one of your businesses, one of your key types of clients, like companies that provide text messaging services?

Timothy Dick: [00:30:56] Yeah.  we’re actually, we’re getting ready to launch some new products along those lines.  the two of the biggest things because we, right now we have kind of like the phone system in a cloud and you know, those numbers are text enabled.

You can manage them in your control panel. But we’re actually getting ready to launch some standalone tools that are for businesses that want to use text message, and also picture messaging and video messaging.  you know, as part of, typically as part of their communications. There’s one thing that we don’t do is like, we’re not really fans of, and we don’t offer like the you know, the mass blasting, we focus more on like the two-way communication. So in a way,  like one of the, one of the products that we’re launching, you know, is essentially where a business can text, enable any phone number, whether it’s with us or not, as long as it’s not a cell phone number or something that already has texting and they’re able to manage it from an online control panel and send and receive messages to, you know, any customer that has a text capable phone.

So it’s kind of like live chat in a way, but it’s texting. And what’s really cool is like, let’s say that, you know, you have a plumber or a service business, you know, maybe someone texts them, Hey, I have a problem. You know, I have something going on. They could reply back to them and just say; can you take a picture of it and send it to me?

And, you know, and then they could, send them back a video. You know what I mean? There’re so many uses.

Robert Brill: [00:32:38] Over your computer or your mobile phone through an app.

Timothy Dick: [00:32:42] For the consumer. Yeah, it’s built in. They don’t have to have an app or anything like that.

It’s just built in. But yeah, for the, for the business, they can manage it either online or using an app.

Robert Brill: [00:32:58] Wow. That’s pretty cool. It totally becomes a text.

Timothy Dick: [00:33:03] And then the secondary service that we’re, we’re looking at that I’m probably the most excited about, it’s been in the works for a while, is pretty close.

So hopefully, you know, it’s gonna be something that we launched later this year. It’s all based on. Analytics and using phone numbers for tracking purposes and, integrating it with ads. So, you know, as an example, obviously, you know, businesses now having a very memorable phone number is not as important as it used to be.

So a lot of businesses for their main number, almost people have them saved or they’re clicking on it or something like that. So people, um. May still want to have that primary number, but one of the things that can be done is phone numbers are so inexpensive to acquire for a company like us and you know, I can just tell you that like, you know, there’s Twilio and all these companies out there that offer phone numbers for, you know, a dollar a dollar 50 a month, something like that.

I’ll just say that that is a, an extremely profitable amount of markup. With him that, but, basically, you know, phone numbers are cheap. And also the fact that we’re nationwide and in Canada, we can issue phone numbers that they’re not necessarily location specific and they’re not tied to a line or anything.

So we can issue all these virtual phone numbers that are texts enabled. And if someone calls them, you know, it’ll just forward and to wherever they want it to forward to. And any ads that they run, whether it’s especially for print or offline business cards, and like that. There’s a huge demand for a lot of businesses to just generate a phone number that goes with that.

So then the portal that we have, you know, they could just say, I need a number for a ad in Penny Saver or whatever, you know, and it generates a phone number for them that then, if anyone calls that phone number, they’ve piled reports of like, this is where that person came from.

And you can do the same thing on a, say like AdWords or Facebook ads by dynamically generating phone numbers for different ads. Because one of the things, attribution, you know, is always kind of a messy situation. And so if someone clicks through, you know, to your site, you know, obviously you’ve tracked that click, but then if they buy by calling in you may lose that in terms of the attribution, but if the phone number on your site, instead of being,  you know, a static phone number that is just assigned,  it’s a dynamic phone number that shows based upon where they came from or whatever criteria is set. Then a you’re able to track that in your reporting too, to know that someone came in from this particular Google ad, even though they call this number to complete their order we know through the call logs that that’s the only place they would have found that number. And, you can get inton you know, more sophisticated stuff for like higher value type clients. Like if you’re selling like a high ticket service, some even assign like a, you know, a dedicated number, just so that all communications with that customer so that they can,  you know, really track that and all the follow-up and all that.

And so the idea is like, you know, essentially taking. The tracking and reporting and all that is fairly simple. But when you combine that with being able to text, being able to have the voice calls forwarded, and then being able to tie into other platforms is something that we’re going to add later. So, you know, imagine being able to, it’s almost like creating a, using a phone number as an identifier for consumer. And say like, they call in, they give any info to, you know, an agent on the phone or through the text or a messaging bot or whatever, you know, and maybe they give some other contact info that’s all added to their profile. So it’s kind, has a CRM built in and, you know, it could pull info like number sources, you know, LinkedIn, any of the, you know, the data services. You could just populate all that in and then anytime you get a call from that phone number, you’ll know, you know, it’s that customer, if that’s the way you have it set up.

Robert Brill: [00:38:10] Where they originated from. Yeah.

Timothy Dick: [00:38:13] Yeah.

Robert Brill: [00:38:14] Oh, so you make better decisions about your digital.

Timothy Dick: [00:38:17] And the other use case, I mean, there’s so many, but another one that’s really popular would be, especially for Lead Gen type companies that are doing a lot of lead gen campaigns. I don’t have the exact statistic in front of me, but, it’s pretty high that,  if someone goes to a website looking for a service and they see a local number versus like a toll free number or a number that’s somewhere they don’t know where it is. They’re more likely to call it because, you know, they could be searching for, you know, like roofing companies, and then they see one and they’re like, Oh, that’s a local company. Cool. You know, so they’re more likely to call it. So we can take a business that maybe they’re going like a national lead gen campaign and just based on the geolocation of everyone that sees the webpage. A phone number for that location is shown. So it’s always looks local for them. And the way that would work on the back end is, you know, essentially in the website code, instead of putting in the phone number, we would just give them some code that dynamically assigns the signs, the phone number. And so it’s pretty much instantaneous for the customer. But basically wherever they access it from.  since we have the coverage, all over the, you know, all over the country, we can give a local or regional number that’s at least in the same area code.

Robert Brill: [00:39:57] I had no idea of voice over IP could be so interesting.

Timothy Dick: [00:40:00] Yeah. Well that’s the thing. And you know, so it’s like, that’s where it really kind of, for me it’s been, you know, cause I’ve had, I’ve had a SAS is something that if you have a stable SAS company, it’s something that asset wise, like a lot of people want to buy it because it’s recurring, you know, all that.

And so I’ve had a lot of those offers, but you know, I’m really, I really enjoy, you know, marketing and all the new marketing tech. And so one of the things that I’m really trying to do is figure out ways that we can leverage the fact that we are a, telephone service provider and have access to some things that only a telephone service provider would have access to, such as the ability to get a phone numbers at a very, very, very low cost.

 and the ability to do all these interconnections and messaging and tie in with different things and combine that with, marketing. You know, both by, in some cases, building APIs and things like that to tie in like Twilio has. But I think that one of the missing pieces is that if we just built APIs, like Twillio, I mean, yeah, everybody can tie in, but ultimately, there still has to be companies that build the innovative software that uses that API. And so the fact that, we have a have a marketing agency that does marketing and consulting for businesses were actually able to look at what are the gaps there and let’s just build it internally.

And build the software. And so it’s something that, because ultimately, you know, if you think about, you know, just commodity phone service, the price is just going to continue to drop. I mean, it’s, you know, every few years it’s just going to get cheaper. But when we have all of these things layered together, it’s very sticky. You know, in terms of a business has a lot of reason to use our service over, you know, a cheaper, simplistic, basic line.

Robert Brill: [00:42:33] So tell us a little bit about ProfitLayer, I mean it sounds like, what’s interesting about this is you focus much more on marketing and certainly advertising is part of it.

But I think it’s interesting that you, from, from our discussions, it sounds like the thing you like to do best, like it sounds like you, you just enjoy diving into marketing challenges and solving for them. Is that.

Timothy Dick: [00:42:57] Yeah, I would say it’s marketing challenges and really just business in general.  and you know, and a lot of that does fall into marketing.

What we do at ProfitLayer. We can run advertising campaigns really well. We have a team of media buyers.  you know, we do a lot of stuff and we, we manage ads for, you know, Jay Abraham, Steve Sims, I mean,  a lot of, a relatively high, high profile,  accounts. So we do a lot of volume there.

But then there are also other businesses that we’ve found that they’re kind of put into this box where it’s like, you need Facebook ads are unique Google ads, or you need just one type of solution. And depending on what the age is to see offers that, you know, it’s telling them that. And we take a, like an agnostic approach, you know, and we basically work with them to look at their whole business and figure out. a) do you really even need more marketing? Because there are a lot of people that come in. It’s kind of like, you know, really if we break it down, like in your sales process, that closing rate is really low based on what we see in your industry.

So why don’t either we refer you to someone or if it’s something we can help with, whatever it is, let’s get that fixed first, you know, and get the closing ratio up from 2% to close to 20.  and then we’ll amp up the marketing for you. You know, so they may come in for one thing, but we look at the whole picture and diagnose and a lot of times, like, you know, they’re just minor tweaks that can be made. You know, like another example that we see a lot of our businesses that are doing, a free strategy session and, you know, they’re like, I’m drowning in calls. I’m drowning in calls, but I need more leads. So I guess I need to hire more salespeople.

And a lot of times, like we have seen countless times where it’s like, what if you just charged for the strategy session? They’re like, Oh, well nobody would, nobody would book that. That’s like, well, if they value your knowledge and they’re wanting to hire you to do so. I mean, the right people, Whoa.

And so you could potentially reduce your workload there. We could increase the marketing and you end up basically making more profit, you know? So it’s a matter of like looking at all those layers, you know, whether it’s advertising or just parts of the business that can be optimized to help them get more profit and have the business that suits them.

Because, I mean, we have a couple people that I can think of off the top of my head that are like, I don’t really care if my business makes any more money. I just want more awareness, you know? So we were like, well, we can optimize for fame, you know? Or are there some that, you know.

Robert Brill: [00:46:24] How you optimize for fame? I like that. I like how you call awareness fame. That’s really interesting.

Timothy Dick: [00:46:30] Basically, there’s a lot of, retargeting and just plastering them in front of their audience everywhere their audiences is. That we can reach, you know, so a lot of that is with, you know, a lot of the types of things that you do with, you know, native platforms and programmatic and all that.

 we, we do a lot of that. And, it’s really interesting some of the things, because sometimes businesses, I think that, you know, we’re really kind of a, just so used to the way things are that sometimes we don’t really know what we need. And we think the solution might be to do one thing, but it’s not.

And if we, as a marketing agency, and someone comes to us saying, I want you to run my ads, you know, here’s the budget, here’s all that. And we, basically say no, you need to go talk to the sales person or some sales person that can help you manage, your sales team better and optimize that and get those numbers up because we don’t want to waste your money.

And when they get that fixed. We’re the first call they make, you know, they come back because, everyone is so eager to take money. But you know, we’re very big on, our job is to make you money and get you many multiples of what you spend, but we also don’t want to lose your money.

You know, and obviously, testing and things that happens occasionally, but you know, our goal is to manage it really prudently. So, I always look at it as kind of like, you know, their investment advisors that work for a specific fund company. So they’re kind of biased towards those funds because they’d get a higher commission, or that’s the company they work for.

So they can’t objectively look at the person’s financial situation and say, a) this fund from the other company is actually better for your situation. Because it would mess it up. So, you know, like the fixed fee. Whereas if you just go in, you know, pay them $2,000 or whatever they charge, and they look very objectively because they’re not incentivized by, what your choice is. You know, they’re able to give you all your options. So that’s a, a lot of what we do and a lot of the way that we do that is through Office Days. Internet Office Day is typically, you know, a couple thousand dollars people fly-in,  some come locally, some fly in.  we sat down with them and just spend the whole day digging through their business, talking about their problems, and really diving deep into like what the root of the actual problems are, and then we break it down and they leave with a plan or strategy on how to fix that and we focus on, like what is the next most immediate thing that’s going to affect your business. Because just with like the leads and sales, like, you know, if you look at that in like a linear line, you know, and you, on the left side, you’re trying to just like 10 extra marketing and on the right side you’re not closing any sales you actually should work backwards on that and, you know, get the closing rate fixed first. So, we’ve tried to narrow it down to like, what is the one thing you need to fix right now? Okay, now that that’s fixed, what, what’s next now? And just kind of go through that process with them.

Robert Brill: [00:50:37] Do you, do you consider yourself a marketing firm or a consultant or business consultant consulting?

Timothy Dick: [00:50:44] I would say that we were hybrid. You know, and we have some clients that we really don’t do any marketing for. Some that are just business consulting clients that, you know, we just help them with their business or, you know, I have a lot of background in angel investing. After HostGator, I made a lot of investments and things.

So, we have some clients that are just for that. But the marketing piece it’s kind of the draw because one of the things out there with like, even if you’re a really, really good business consultant, people generally do not come to you until they’re in pain, you know? But if you are offering marketing and increasing sales and you know, something like that, they want that all day long, you know?

So, it’s kind of, in a way, like for some people they want marketing. They come in, we give them marketing, everything is smooth, but in a lot of cases, they don’t know that they need anything else. But when we sat down and talked to them, it’s very obvious that they should be doing something else before marketing.

Robert Brill: [00:52:02] That’s really interesting. It’s like from everything I’ve heard you, you’ve learned this organically through your, career, that this inserted into people’s behavior. And I really liked that point. If a consultant goes into the marketplace as a consultant, it’s, I think a little bit more difficult to, or what you said, it’s a little bit more difficult to get a customer, but to offer up more sales. You get an opportunity to have a someone coming in the door, and then you actually get to give them the prudent advice of whether or not sales. You know, more customers marketing, tightening up your invoicing, tightening up your sales process. That’s a fascinating insight.

Timothy Dick: [00:52:48] You know, we can help them scale their business and grow so much faster if they’re coming to us, before they’re in a lot of pain and have major, major, major problems.

Robert Brill: [00:53:02] So what are some of the mistakes that you see people making? Without going to details about who this is, do you have situations where you say, man, if you just would’ve come to us three or six months ago, you would be in a position and what are the things that people are doing. What did they lose or what’s the thing that triggered them to kind of get into your sphere of influence?

Timothy Dick: [00:53:32] You know, a lot of times, like it may be something that they think, you know, my marketing is not performing as well as it used to be. And then, so we start out like, okay, what’s your sales process.

You know? And that could be, you know, an order form. That could be phone, it could be a salesperson, it doesn’t matter. But we figure out what’s there and work backwards. And you know, so they may come in saying, you know, my marketing’s not working and I haven’t changed anything. I don’t understand why. And then we might go in and we’ll look at, okay, what metrics are you tracking in your business?

 one client in particular that came in sells a, high ticket course online.  you know, and it’s a $7,500 course and you know, she, she had been doing really well, a couple of hundred, a thousand a month for cruising for quite a while. And then I guess it was about a year and a half ago she was she was relying solely on Facebook ads, didn’t really have any other kind of paid advertising, and so she came to us and said, I need to get on Google.

I need to get on these other platforms and diversify because my performance on Facebook’s dropped and one of the things that we, we found within that is when we audited that account, I just said. You know, how are you getting this acquisition costs for sales that you have, you know, because $7,500 and you know, and I, you know, let’s say she said the acquisition costs is like 2,500.

I’m like, how are we getting that? She’s like, well, I just take the total number of sales and divide it by how much I spend on Facebook. And, you know, I’m like, but wait a minute. You have a podcast you speak. You have a book, you have a very large organic network you post all the time. Maybe some of those sales are coming from those sources.

So, when we actually put in tracking, because all she was really aware of that you needed to look at with marketing was, I’m making more revenue and my cost of leads is going down. And, you know, and she had an agency that was charging a lot of money to manage that account for over a year. That was just a saying, you’re getting cheaper leads and you’re making more money.

They weren’t actually tracking anything though. And, when we actually went in and put tracking in, she’s from, a state that has a low cost of living. And she had flown out and when we were going through it with her, after about a week of putting in, the proper tracking and conversion tracking and everything, we’re like, okay.

First of all, it seems like the agency has been optimizing for cheap leads, not necessarily for leads that are going to result in a sale. That’s part it.

Robert Brill: [00:56:43] Tim, what was then, what was the pain point this woman had? Was she saying originally before I just want to I, forgot what you said like three minutes ago.

Did you, did you say that she wasn’t converting as many sales?

Timothy Dick: [00:56:57] Basically. I haven’t changed anything with my marketing. I’m still spending, you know, about 50,000 a month. You know, my sales are not going, not quite as high as they were. It seems like my marketing is dropping off, so I think I need to add more marketing and add Google and add other networks.

Robert Brill: [00:57:17] So basically my marketing’s not working as well. I need to change platforms. So effectively Facebook isn’t performing as well.

Timothy Dick: [00:57:24] Her solution was to add more. But when we went in and looked at it and actually put in tracking, it turned out that only about, I mean, she averaged about 50,000 a month in spending on Facebook.

It turned out that once we started tracking it, only about 20,000 a month or so of that spending was producing any sales. The rest was just producing leads that never converted, and it had been that way for so long. You know, that she just like looked at us and she just said, she’s in a low cost of living areas.

She said, that’s like three houses over the course of the year, you know, just because she didn’t know and she just trusted. That the agency she was getting advice from, you know, she said it was logical to her that I’m getting cheaper leads. I’m still profitable, everything’s good. You know? So that was where she, you know, we put in some changes and you know, and that drastically changed her business.

Robert Brill: [00:58:28] So, so what is the solution? Did, so did you, I mean, again, I don’t want to go into things that you can talk about, so just tell me, you can’t talk about them if that’s the case. But like, so did you find ultimately that some of her organic traffic was driving lead generation. I imagine there’s an element of nurture that needs to happen there.

Timothy Dick: [00:58:50] We found that basically by, we were actually able to, you know, cut the losing campaigns out, you know, and so just within Facebook alone, without really adding anything else, we were able to cut that from about 50 to 20. So, you know, I’m saving about 30,000 a month and still make more revenue and profit.

Robert Brill: [00:59:13] That’s incredible.  And that’s really the difference. That’s when you’re spending so much money, it really makes sense to have a strategist and an analytics top line view of the business and what we see, you know, if I could just take a tangent.

When we see like we have, we work with all kinds of firms that when we see campaigns where there’s miscommunication and where the campaign doesn’t perform is because there’s no strategy in place. And what we’ve learned in our business is that we need to be much more stringent on how we vet clients so that we know that someone at some level of this stuff is thinking about strategy because we can deploy advertising, but if there’s no cohesive marketing messaging, lead magnet, landing page, email, social media strategy, you might as well just not do it because the chances of failure exponentially increase when no one’s looking at it like that.

Timothy Dick: [01:00:17] Oh yeah. For sure. Yeah, and I think another point that you had made that I think is really important that has just helped us so much is that one of the reasons that we’re able to do this really well and get really good results is that.

Everything that we do is stuff that, we have learned in building our own businesses, and in some cases, learning the hard way.  you know, I’ve learned a lot of stuff and, you know, I’ve actually, I’ve kind of always been entrepreneurial, but, I grew up in rural West Virginia, my dad was a coal miner.

No one in my family was entrepreneurial or anything, but, I had a couple people that, you know, I always said that I was just felt different. Like apparently, you know, from when I was like very young, I always said, I’m going to move to California or New York when I grow up. And, everyone’s like, Oh, okay. Yeah. You know? Yeah, right. That doesn’t happen. You know, here is reality. And, then once I got on the internet. I realized there’s a world of possibility out there. And so, you know, when I was like 12, 13 years old, this was the peak of boom.  you know, so I just started learning and self-taught, you know, self-taught web design, which that’s what led into hosting.

And, you know, it kind of snowballed from there. But it was all just self-taught because I just had, this drive that my driving factor with most of it was, my, you know, my parents, I had a, they had made a deal cause I, in a very small town, you know I finished high school early, because I just finished all the requirements early and stuff.

And so, I was still 17, and my parents and I had to deal with it, you know, that I could move when I finished high school. And so when I was 17 and I finished high school early the day of graduation, I moved into my first apartment a few hours away. And, then from there,  you know, went on to upstate New York for a while, and then down to Florida, Houston, and here in Orange County.

But, that was a really,  it really shows the power of the internet, especially today, because this was a, you know, I’m 33 now, so this, this would have been 20 years ago. When I was, you know, like 13, 14, 15 years old, learning on the internet and learning enough to teach myself the business skills and the, you know, the technical skills at the time and the marketing skills and learning all of that.

And now, you know, there’s exponentially more information out there, you know, and I think that, that’s something that,  you know, a lot of people just overcomplicate things. And they think I have to learn everything. And you know, I have to, it’s kind of the old version of that used to be, I’m going to get my business cards made and then I’m going to do this, and then I’m going to do that.

And then I’ll actually start figuring out what I’m going to sell, you know? And now I’m, you know, there’s some of that online, but it’s like, people really can just start something, start with something simple and, you know, turn it into a, you know, a really wildly successful business.

Robert Brill: [01:04:03] Absolutely.  so Tim, I really appreciate this.

I think this was a fantastic conversation. Couple of things before we go.  so number one, I’m a big foodie. I love eating all kinds of really great stuff. I have a food blog called Dude let’s eat. I haven’t posted in a while on Instagram, but I still keep taking the photos. I’ll eventually post them. Is there anything in Anaheim or anywhere in your travels that, or anything you cook at home, that you particularly like, that you can share?

Timothy Dick: [01:04:32] You know, I would say nothing. Nothing really too, too crazy. One of the foods that is a kind of a tradition in West Virginia is the pepperoni roll. Which is not as common, a homemade pepperoni rolls. It’s kind of a rolls stuffed with cheese and pepperoni.  and it’s just kind of a tradition in West Virginia.

I just don’t see it in a lot of other places. So I would say that’s, that’s kind of my unique, favorite food.

Robert Brill: [01:05:03] Pepperoni roll on that.  on that general subject, there was a pizza place that opened up in Sherman Oaks called Gino’s East, which is one of the top pizza places from Chicago, and I cannot stop going to eat there.

It’s like I go there once a week and every time I go, I’m like, okay, I’ve got to go on a diet. And like I’ve been saying this to my wife for like two months now. They just opened in December. I’m like, okay, I’m going to go once next week. Going go on a diet doesn’t happen. I went there yesterday again, I have some leftovers right after this podcast.

Tim, so, how can people, how can people find you, your business, your email, your podcast, anything you want to see?

Timothy Dick: [01:05:50] They can, they can find a VOIPO at VoIP with an O in the end, And Profit Layer has links to the podcast, all that, which season two is getting ready to launch, so right now, as of today, there are a few episodes that are queued up from the last few weeks that we’ve got some pretty cool, pretty cool ones coming out and people can also just find me on a pretty much any social platform.  LinkedIn, Facebook, a Timothy, Dick, D, I, C, K and a just, they could find me on any social platform.

Robert Brill: [01:06:47] Awesome. Thank you, Tim. It’s been a pleasure. I enjoyed the conversation.

Timothy Dick: [01:06:50] Yeah, definitely. Thank you for having me on. And, and yeah, I just encourage everyone out there to, you know, take advantage of the opportunities that are available and, look at all the layers in everything you do, because that’s where the gold usually is.

Robert Brill: [01:07:12] Thank you for listening to this episode of the LA business podcast. If you like what we’re doing on this podcast, please consider subscribing on Apple or Google play, leaving a five-star review and sharing with your friends. If you have any questions, comments, or recommendations for a guest you’d like to hear on this podcast, please email me [email protected] thank you.

Have a fantastic day.

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Intro Music: Echegoyen Productions

Created By: Brill Media