|How to establish a partnership in return for marketing|
The subject title probably dont make much sense, allow me to elaborate.
I own an automotive enthusiast site that works on a standard concept (with a few unique twists) in a new market (that is, I don't really have any direct competitors).
I'm of a technical background and have (and can) easily handle the technical aspects of the site, however I have to admit that I am not harvesting the full potential of the website due to lack of marketing. I know the potential is there, because the website has grown very fast with very limited marketing, but I cannot get it into the elite league.
I'd like to find a marketing manager who want to become a partner (instead of hiring one), as I don't have any start capital for it, so whoever shows interest must be able to see the same potential I'm seeing.
So in short, i'd like to prioritize growth of the website from this marketing manager in return for future revenue.
I'm not sure how to go about this, so would like to ask for advice.
What i'm thinking is that I could offer 50% ownership of the site to the marketing manager if he/she is willing to do the following:
- Provide X amount of money for marketing
- Use the X amount of money for marketing
- Establish stabile growth
And in return get:
- 50% of the income from ad sale in all future (a huge amount of potential here if the growth happens)
- 50% of any other income
- Does not have to pay to any technical expense
So in short, provide money, skill and labour in return for the partnership of a custom solution where he/she can see the potential. The money provided will not be accessible to me, however I will require proof that it is being used to market the website.
I think, the more money he/she is willing to offer, the more serious his/her commitment must be and the potential he/she can see in the site. It's pretty risk free, as he/she never shares any money with me, does all the marketing (for growth) and selling of ad slots, takes the money from the publishers and split with me.
In return I get the marketing aspect covered which I lack in, ensure growth and can harvest 50% of the income from the future revenue stream.
Of course a contract will have to be outlined, that protect him/her and me in case he/she and I do not uphold the requirements in the contract.
So to keep it short, the idea was to put the above into a a bunch of spreadsheets/presentations/pdfs and put it all up on flippa and see what happens.
If somebody bids X amount and shows interest we could take it from there.
As far as I know, the above is a very different approach, therefore input is appreciated
It's not a different approach. The idea of giving a programmer 50% ownership of a pie in the sky idea instead of a salary is 40 years old. So is the idea of convincing some sales genius to work for you for maybe a payday some day in the future.
You're not going to get someone to give you money to let them sell your ad space. Even I'm not that good of a salesperson, and I sold to salespeople for years. I suggest you remove that idea right out off the table.
Here's my short answer. You need to suck it up buttercup, and do the marketing yourself. I know you don't want that answer, but it is the answer. If you don't do that, you will not likely be successful.
I say that based on my experience. I had a website that generated a ton of traffic that needed to be sold. I tried everything - and the only thing that worked was my actually doing the sales. Now, somehow, I'm an accomplished salesperson. And I'm beholden to no one. In short - I've tried a whole bunch of things that involved someone else doing the sales/marketing and I always ended up unhappy. If you want the tip of the iceberg on your problem, what if you give someone 50% and they don't do the job you want..then the website takes off some other way and they're in for 50%. Lots of other bad scenarios can happen, and I've enjoyed them all. There is no case I've seen where the scenario you're presenting ends up with you happy.
I have experience from the other side as well. I have a friend who had an excellent website. They offered me 1/3 of their site in exchange for selling their ad space and helping grow the site (since, see above, I somehow ended up being successful in sales, despite the fact that I'm a tech). I declined, I simply don't have the time or interest in taking a startup project from someone else and making it take off. In short, I don't want 50% of nothing.
Funny story (funny ironic), a few years ago they came back and asked me to sell their traffic. NOW they had huge traffic and were successful. So now I said sure, would love to do it for a 1/3. They responded that they weren't going to give me any ownership, just a commission. Again, that was unattractive because I already have other stuff I do.
And the moral of that story is, you should appreciate that the way this will be percieved is that you're offering 50% of nothing AND you want someone to pay you for that.
And it's not sales or marketing. It's no harder than pick up the phone, call a potential advertiser, and ask them if they're interested in advertising. It's not the bogey man here, there's nothing to know. All you have to do is pick up the phone.......
thanks for your answer wheel, much appreciated.
Quick correction, I DONT want any money. What I'd like the marketing manager to do is to bid X money for the 50% ownership, however manage the money him/herself. That is I only require read-only access or another kind of proof that this person is actually using money to promote the site.
I firmly believe that I can earn more than enough money (50%) from the ad sales, once the site gets marketed. I also believe that the website can be marketed without using any money (although probably a bit more difficult to do so).
I'm happy with no money, as long as there is growth, but I simply cannot see how to assess a person's commitment if money is not involved. If he/she invested nothing, they would have nothing too loose if they 'gave up' or did a half-ass job. I invested close to 5 years of development in the custom site, therefore I'd like something concrete as assurance for the splitting of ownership.
So the way I see it, their X amount of money is indicator of their commitment and my security of them upholding their part of the contract.
Eg, something like this in the contract:
- If the marketing manager fails to provide proof of the marketing performed and how the marketing budget was used the contract is terminated with .... yada yada
Does it still seem unfeasable ? Would you (hypothetically speaking) be willing to invest X amount of money and make it grow, if you believed in a project for 50% ownership ?
Well, this is all matter of opinion. The problem you have, no matter how you slice it, is trying to get someone as excited about your project as you are. My repeated experience has been that you won't be able to find someone like that. And if you do, you then have to convince them to put up money - something you're not even prepared to do yourself. That should make you think about the viability right there. You're not even willing to remortgage your house or max out your credit cards to put into the business. By comparison, in years past, I have done both of those things. But I had the numbers to show that what I was doing wasn't a hope, I had numbers and just needed capital to expand.
>>>Would you (hypothetically speaking) be willing to invest X amount of money and make it grow, if you believed in a project for 50% ownership ?
My personal answer? No. That's why I provided the example in my first post - I've been offered this and declined. Then once they had built a busy website, the ownership deal was off the table.
Perhaps look at this from another perspective. Realistically they have to commit funds + work. In exchange, you're actually offering 50% of nothing. That's harsh, but I think you need to look at this from this type of perspective.
My personal recommendation, FWIW,is to figure out how to do the marketing yourself - and DO the marketing yourself. You will find no one better able to do so anyway. The result of that will be both more money in your pockets, and a more solid business foundation because you know how to do everything in your business.
"The problem you have, no matter how you slice it, is trying to get someone as excited about your project as you are. "
"And if you do, you then have to convince them to put up money - something you're not even prepared to do yourself."
Not true. I wouldn't mind putting money in, as I do believe in the project. I wouldn't mind putting in say the same amount as a partner will bid.
However I feel that the 5 year development and the initial marketing to get the site up to the current level (4K members/200K UV per month) also has some value and therefore I shouldn't be investing as much as a business partner, but when I see your point about "getting someone as excited as I am" then I can see that this may be too biased and I have to "put money where my mouth is".
"I had numbers and just needed capital to expand. "
That's where I am, except I don't really capital. I need someone who can market the site to expand. To some extent, I have the capital myself.
But i'm a technician and my marketing efforts are simply not as productive as someone who is a specialist in marketing. Acknowledging that is (i believe) the first step to making the website grow beyond what I have been able to market it to.
Forgive me if I missed it, but, what I understand is that you're trying to find a way to get someone to fit into a scheme you've outlined.
Why limit it to that scheme? How about paying a freelance marketer to do the marketing for you, and then, when the site is a success, you get to keep all the profits.
Also, why offer 50% to a partner. If you offer 49% you will retain a controlling interest.
|Forgive me if I missed it, ... How about paying a freelance marketer |
You're forgiver.. :)
|I don't have any start capital for it |
I see two potential problems with Wheel's approach:
1) Time spent on marketing takes time away from the technical side of things.
2) Not everyone is good at sales/marketing.
To be successful in business, you have to know when to outsource, especially when it comes to aspects of the business that you can outsource more cheaply (in terms of money or human capital) than you can do yourself.
On the other hand, as the OP seems to understand, focusing solely on the technical side of the business limits the growth potential.
I agree with Wheel that it will probably be very difficult to find someone to fit into the partnership you've outlined. If you could, it would be a great fit, but probably 99.99% likely it won't be a good fit.
More likely, you're going to need to find an investor who can infuse the needed capital. Then you can take that money and hire a freelance marketing consultant.
>>>.To be successful in business, you have to know when to outsource, especially when it comes to aspects of the business that you can outsource more cheaply (in terms of money or human capital) than you can do yourself.
Yes, I completely agree. That's why I tried repeatedly to outsource the sales and marketing of my business. Doing so has nearly bankrupted me in the past. I'm not a succesful sales and marketing person because I know how to market and sell. I'm a succesful sales and marketing person because I'm a tech person that woke up one day with my back against the wall, having tried 3 other people (all of whom were seasoned sales pros in my niche) and every one of them either screwed me or simply didn't put in the effort.
In other words, I agree with your sentiment, and wish it were true when it comes to finding someone to promote a small independent business - but my experience has been that it's not the case - no one is better than the site owner.
Your point is very true for tech people. I don't waste my time writing code - that I hire out. Sales and marketing of your site though? Attempting to outsource that is a common mistake of small business owners IMO.
>>>>But i'm a technician and my marketing efforts are simply not as productive as someone who is a specialist in marketing.
Incorrect. You are the best person. I predict that you will be unlikely to find someone to partner with, and if you do, I predict the partnership will fail. I further predict that if you suck it up and do the tough work, you will wake up one day and consider that you owe me a beer for making you do something you don't want to do :).
Think about what you're asking someone to do here for a sec. You're going to get some person all excited about your business. They are going to pick up the phone and start calling. WHo exactly are they calling? You don't think you're going to hire someone who has a magical list of phone numbers do you?
Or do you think they're going to start googling and calling likely candidates in your niche? OK, so now they're blind calling people. That's your first mistake - you ain't no-how going to find a decent rep who thinks cold calling is a good idea for their income. And if they do, do you really believe that this person has some sort of skill set that allows them to somehow convince people to buy what they're selling if they don't want it? That idea is commonplace,and it's false - do you get sold stuff you have no interest in?
There is no magical fairy sales dude with cash to invest in your business who's going to cold call people off of Google and sell them advertising in a business he's not an expert in. There is however, an extremely technical knowledgeable person who knows the business cold and is excited about it - that's you. Heck, I just got off the phone (again, I have no sales experience) with a customer who drilled me with technical questions for an hour. At the end, they thanked me profusely and told me how it's clear that I'm passionate about what I do - a comment I hear about once every couple of weeks. That's me, not a salesperson. And if someone's going to buy from you, they want passion and technical expertise, not a sales job. Disillusion yourself that there is a simple sales formula other than that.
Let me boil it down for you. I know what your problem
is. Your problem is that you're too chicken to pick up the phone and speak to someone who should be advertising on your site - to their benefit. That's it - you're scared of the phone.
Who knows more about your business than you? Who is more passionate about your business than you? Who knows better how to answer the question as to why someone would advertise on your site than you? Nobody. So why again aren't you doing this? Yeah, I know. You-don't-wanna.
Eventually you'll realize that either it's you doing this, or you don't believe enough in the business and it goes nowhere. Them's your choices.
Think I'm wrong? I've got repeated experience doing exactly what you're trying to do, from both the hiring and being hiring side of things and the only thing that works is what I do. You can reconsider when someone shows me how staying hidden behind your monitors and bringing on a one-man show just to sell your marketing has worked out well for them. EVeryone wants this, everyone rationalizes it, nobody pulls it off.
and take that thrashing as it's intended, as a wake up call to make you successful in what you're trying to accomplish :).
thanks to everyone with their input. The more you guys comment the more I learn, but I also feel that some of the comments are based on lack of background knowledge (which I left out to keep my posts concise).
My website is not a business, it's an enthusiast site. You could say it is similar to this sit as it fosters a community of webmasters.
My website fosters a community like facebook does around a particular niche/widget, in a country where there is no such concept. And the concept is hugely a success in other countries. This is the reason I feel that their is a huge amount of potential to be harvested for those who know how to do so efficiently.
So as such, I'm not selling products nor services.
I tried marketing the site just by partnering up with a few sites, a simple link exchange, providing them (and their members) value, and boom I had 100+K unique visitors and a basic member foundation.
Someone who is more efficient could take this into Millions in traffic and members. At that point I don't need to 'sell' ad slots, the companies will contact me to sell their products & services.
Having capital myself, my MAIN ISSUE is that I don't feel a free lancer marketer can commit to the site as a part owner can. Hiring a marketer will most likely give me the same outcome which wheel outlines.
I need ideas on how to compile a business offer that is highly attractive but ALSO put some stakes in from the business partner (I have no issues raising my stakes), so he/she has something to loose if he/she doesn't commit.
So i've thought of the above mentioned scheme but need your help to criticize it, so I can fine tune it before presenting it. Or suggest me something better...
Hope the background information gave a clearer idea of my scheme.