Rand of Moz was kind enough to agree to be interviewed, here he we talk about his blackhat days, costs of running Moz, company culture, customer loyalty and much more, enjoy.

For anyone living under a rock, could you just introduce yourself and tell us a little about what you do?

Sure! I'm the co-founder and CEO of a Seattle-based startup called SEOmoz that focuses on making software to help professional marketers with inbound marketing channels like SEO, social media, content marketing, community building, web analytics, etc. I'm married to the amazing Everywhereist, and we both travel A LOT.

We all know your the whitest of white hats but come on what is the naughtiest thing you have ever done (not including what you mentioned in your WBF)?

I'm assuming you mean this Whiteboard Friday? That robots.txt trick was by far the shadiest thing I've done (though not particularly smart). That said, I used to buy loads of links from some folks out of the UK who ran some very crappy link farms and networks. It worked really well for some of our early clients, then shut down around 2005 or so.

With the recent 3 month delays in rolling out Mozscape updates, I often imagine the Moz turning into a scene from boiler room. Do you think it's your transparency that makes your customers so forgiving? Do you have boiler room moments? :)

Probably not quite that level of drama. Mostly it's a lot of sitting and watching boxes on Amazon via their web monitoring tools and praying none of their crappy hard drives burn out on us at critical moments.

I do think transparency helped in that 3 month lull between index updates, but it likely also helps that over the past 4 years, indices have been relatively consistent and that we're now back to monthly updates. I think if it happens again, we're going to be in much more serious trouble, which is why we're trying to move off Amazon, use some of the recent funding, and build our own hybrid cloud model that can work with Mozscape in a much better way.

You've said running an update can cost up to $300,000, will moving away from Amazon cut the costs and improve your software's running power? Are you planning to build everything in-house long term?

We'll probably stick to a hybrid cloud model for some time. We don't quite have the need for an entirely in-house solution like Google or Bing yet. In terms of costs, April was, I believe, close to $650K with Amazon, so pretty damn awful. Even with indices running weekly at 2-3X the current size, we think our costs can be closer to $150-$200K in a hybrid model with customized hardware. We should know in the next 3-4 months how that effort is shaping up.

When Yahoo! site explorer closed it's doors did you see an up turn in sales? Where you secretly happy? :)

Surprisingly, it didn't have a big impact. I was definitely expecting a large bump, but we saw more of the same nice slope of growth we'd been experiencing for the months prior to the shutdown. I'm not entirely sure to what we should attribute that. In terms of my personal feeling - no, I was actually bummed. Yahoo! Site Explorer was a phenomenal tool for evaluating the relative quality and value of our index and metrics, and I think more access to data is better than less.

You recently said you had some crazy plans to get to a rolling index system more like what Google does, can you tell us a little more about this?

Some of our engineers on Mozscape have been working on tentative plans to build a system that updates daily or possibly more frequently. Of course, we couldn't do full processing every 24 hours, so we'd need to find a way to make smart algorithms to predicatively model new link data.

You mention that on an average day 150 people sign up for a free trail, of those 56% convert into paying pro members but then around 40% of those then cancel within 3 months. It seems like a lot of cancellations. Why do you think this is happening

We have a ton of people signing up for SEOmoz PRO who are not SEO professionals and are likely hoping that our software will simply "do SEO" for them. Obviously, that's not the case. Software can help with metrics, analytics, recommendations and tools for research, but it's not going to "SEO your website" which is what we find a lot of the canceling folks are seeking.

That said, I think there's plenty of improvements we can make to onboarding and to the value of the software overall (we have massive plans here, and dozens of engineers, designers and product folks working diligently to see that come to fruition). Over time, we'll likely see the numbers grow, but as the brand gets bigger, a wider and wider audience tries the product, and it's only going to be relevant, useful and valuable to those who know how to make the right investments and who are actively doing inbound marketing, so I wouldn't be surprised if these ratios stay. We think of ourselves as acquiring ~30-40 new, long-term customers every day, and a lot of other folks who the software's probably not a match for.

What are your thoughts on iacquire being deindexed by Google?

I think it's a bit of a slippery slope for Google to ban sites that haven't actually violated their guidelines directly, but I can also understand their perspective. I think the folks at iAcquire likely knew they were getting a ticking time bomb with the purchase of LinkExperts' network, but probably didn't know quite how harsh the backlash would be from a PR perspective.

The piece that sucks is the way some folks in the SEO community have reacted, particularly toward Mike King, who's been formally with iAcquire for ~60 days and only in the country ~20 of those days due to conferences/events where he's been speaking. I think it was a bit of a blindside for him, and frustrating timing as I know his appointment to director of inbound marketing was intended to help iAcquire go in a more white hat direction.

All in all, it's a fascinating case study, and something I think we'll be citing in the industry for a long time to come.

You've said you are going to be taking a back seat from developing other tools to concentrate on developing your Mozscape index, I take it this comes from the 18 million in venture capital you recently acquired?. Do you have any other immediate plans?

We have two big efforts - SEOmoz PRO (the web app that provides analytics and recommendations on SEO campaigns) and Mozscape (our web index). We're also looking at some research and content projects, a few potential acquisitions and a lot of operational stuff (hiring, culture, new offices, etc).

How did you celebrate?

We popped a little champagne the morning of the press release, and had a nice toast together. But we've probably been working harder since the funding than anytime in the company's history.

Do you think the investment is a good thing for the SEO industry as a whole? If so Why?

I'd say the jury's still out. If we can execute on our long-term vision effectively, then yes, I think the investment will do great things for the industry. But if we fail, either in our business model or our execution on providing more transparency of information and great software to marketers, it will probably be detrimental to the sector's perception. We're well aware of this pressure and are doing everything we can not to let folks down :-)


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