Hello! Who are you and what business did you start?
Hi, my name is Eyal Reich and I'm StoreYa's co-founder and COO, along with Yariv Dror, the CEO (and my brother:) and Pasha Zaft, the CTO.
StoreYa offers a suite of marketing and advertising apps that help SMBs increase sales, leads and social following. We support more than 200,000 online sellers that are coming from 186 countries, we also integrate with 30 eCommerce platforms such as Shopify, Magento, Woocommerce, etc.
Our flagship product is called Traffic Booster, with it, we automate Google Ads using our unique AI technology. Take the burden off our clients' shoulders, and get the right customers at the right time for the right cost.
We use the entire arsenal that Google has to offer from dynamic search ads, customized search ads, remarketing, dynamic remarketing, shopping, smart shopping, smart display ads, and Youtube ads.
In addition to Google ads, we manage growth and remarketing campaigns on Facebook and Instagram for a lot of our clients.
We turn our clients' dreams and passions into reality, by driving targeted traffic that generates sales letting our clients focus on their products instead of wasting time on marketing efforts from their end. We're a Premium Google partner one of only 500 Google resellers around the world, we won the 2018 Google Acquisition Performance award, and we're a PayPal exclusive advertising partner.
We launched StoreYa 7 years ago, with the idea of building a valid business, one with a strong business model behind it. As opposed to many startups that pursue their dream and don't think about how to make money in the early stages, we didn't want to be dependent on fundraising, we wanted to reach the profitability stage as soon as possible. We raised a seed round of ~$900K when we first started and for the past 3 years, we've been profitable, generating an average of $700K MRR.
What's your backstory and how did you come up with the idea?
I worked for 4 years as a project manager in design and development agencies, managed projects for big brands like National Geographic, MTV, 888, etc. I learned how an online business should be built.
In 2009 I had a chance to join a brand that targeted the conservative market in the USA, they were looking for a guy that will create their online presence from scratch. That was my first touchpoint with the eCommerce industry. I've built a Shopify store, an Amazon and eBay stores. I managed to reach a 6-figure with the Shopify store and a power seller level on Amazon.
Since I like wearing different hats and I understood the power of content marketing, I built a community of bloggers, I had 20 bloggers that wrote for our blog. We promoted that content to our fans on Facebook, in the good old days, FB ads were not a big thing and the organic reach was high, so you could actually engage with your fans :)
I noticed that we're not making a direct ROI from our efforts in FB, again it was before ads on FB was such a popular thing.
So I thought why not integrate our Shopify store into our Facebook page, and improve the product discovery aspect, basically show our fans different products they might like without the need for them to leave Facebook.
Back then I was 28 years old, living in a small one-bedroom apartment with my girlfriend (now wife), a young man with big dreams, this idea looked like something that is worth a more in-depth check so I knew that the first phone call I have to make is to Yariv, my brother & partner, I told him about the idea, he loved it and decided to convince Pasha, our all-mighty CTO to join us and develop the first Facebook shop ever made, I was the guinea pig, we thought it will take us a couple of weeks, but like every good development project, it took us a few months :)
Focus is key. It's easy to get distracted along the way, focus on your product run as many tests as possible to validate your product offering.
But it was worth the wait, we were happy with the results and the engagement! We were the first in the market that offered a Facebook shop that can automatically import your products onto Facebook from different eCommerce platforms.
The Facebook shop app got a lot of traction and clients, about 20,000 clients in the first year, it was really revolutionary, but we noticed that most of the online sellers put all their efforts in their eCommerce store, and don't market their Facebook store even though we created marketing apps dedicated for the Facebook shop.
We understood that the Facebook shop has huge potential, but if the clients put their efforts on different platforms, we can't provide enough value, which means we won't be able to scale, grow and turn StoreYa into a stable company, so we went back to the drawing board and brainstormed about ideas that can add value to online sellers.
We decided that since they put most of their efforts into their online store, we will develop on-site promotion apps, known as Coupon Pop, Exit Pop, and Refer a Friend.
These apps generate a lot of value in terms of leads and sales but we encountered two new challenges:
- There are companies that offer similar products for free to get into the market
- SMBs don't have a lot of traffic, so with the on-site promotions we helped them to better convert the traffic they have but their biggest challenge was still to get more targeted traffic.
That led us to tackle the biggest challenge they have and offer them the option to set up and optimize their Google Ad campaigns.
This move made a lot of sense for us because Yariv, my partner, comes with a vast experience in PPC, he managed ad campaigns worth millions of dollars in his previous positions, and Pasha has the ability to fly a spaceship to the moon, the best tech guy I've ever met. So, with the combination of Yariv's vast PPC experience, my eCommerce experience and Pasha's tech skills we knew we can take this vision and make it into a reality.
Together with the rest of the team members, it took us about a year to develop the initial Traffic Booster algorithm, and it's something we keep improving on a daily basis.
Take us through the process of designing, prototyping, and manufacturing your first product.
Launching a product is a long process, taking an idea and turning it into a successful product takes many months until you start seeing results. We see our clients in front of us, and try to create the best product that would fit their needs.
Every product we launched was a product that came to solve a pain point. We start with brainstorm meetings between the founders and the different team members, we try to identify the points that would be a game-changer for the clients and for us, we start lean, we focus on the main points we agreed upon and create a Gantt chart, milestones for each task, and create weekly meetings to see that everything is on point.
We start with mockups for each screen, approve the flow of the product, and continue to the design phase. In the UI/UX phase, we put ourselves in our clients' shoes, and try to imagine how they will react, where they will get stuck, which steps they will be looking for, will it give them the sense of trustworthiness we're looking for.
Once this phase is approved, we start developing the product.
Once the product is ready we do a soft launch and invite a specific audience from our list to test and provide feedback; once we are happy with the product we start distributing it by integrating it with the different eCommerce platforms, we always start with Shopify and move forward to Woocommerce, Opencart, Magento, etc. We put a lot of effort in online advertising, we spend tens of thousands of dollars per month on Facebook and Google promoting our Traffic Booster. We send weekly newsletters to about 80K merchants and publish two posts a week to drive more SEO traffic. Basically, we are trying to use all marketing methods possible to gain new clients.
Describe the process of launching the business.
We launched StoreYa back in 2012. What started as a social commerce platform with the first in the market Facebook shop app turned into a leading marketing and advertising platform for SMBs. We launched the FB shop with a free plan, after about 6 months from launching the Facebook shop we reached 500 clients that used our free plan; at that point, we switched from free to a freemium business model and started charging our clients for our product. At that point we also got our first capital from an angel, it was $100K which he, later on, added another $100K according to a milestone we had to achieve within 6 months. In total, we got about $900K in a seed round from two angels and one micro VC.
In one of our brainstorm meetings we asked ourselves which number of clients should we aim for in our first year, we did some calculations but basically threw a number to the air, a big number that will make us work hard and dream big! That number was 20,000 clients and by the end of the first year we achieved it.
The channels that helped us reach that goal at the time were:
Email marketing : we generated a list of 500K email addresses of relevant merchants using the eCommerce platforms we supported back then and sent them cold emails. Since our offering was fresh, unique, sexy and came with a freemium business model, we had an amazing response rate for our email marketing. In the first 4 years, we didn’t spend money on paid ads.
Extensions : at the different app stores
Affiliates : we were fortunate enough to find great affiliates that manage groups of tens of thousands of sellers.
At the end of the year, we acquired 20,000 clients that use our product, aiming high and reaching the goal was so important at that early phase because it showed us that even if it looks like a crazy milestone if we work hard and smart we can reach our goals, it's in our hands.
Since launch, what has worked to attract and retain customers?
We have a few marketing channels that work well for us:
When we first started and didn’t have a large budget to work with we put more effort in Guerrilla marketing.
I remember two good examples that worked well for us.
When Steve Jobs passed away, we created a Facebook shop all-around Apple products that directed to Amazon, all revenues went to donations. This move created a lot of buzz and provided us with free press.
I also used to comment in many relevant articles, I gave comments with value, not just copy-paste them, this led to guest posts in big publications. The bloggers that wrote the articles saw that I know what I’m talking about and invited me to do guest posts on their publications.
Email marketing : back in the days it was harder to just purchase email lists and anyhow wanted fresh lists that we know their source. Our gifted CTO built crawlers that generated the lists for us and the 500K email addresses he gained for us really made our jump start.
Content marketing : we always put efforts in our blog, we understand the power of content. If I had to guess the first 50 posts were written by Yariv and myself. We wrote about online marketing, and the different challenges eCommerce sellers face. These days we have a content manager that deals with it.
FB/IG ads : we spend tens of thousands of dollars per month on acquiring new clients and retargeting past visitors, coming from North America, western EU countries, and Australia.
Google Ads : similar to FB/IG we promote our brand to people searching for targeted traffic. We use text ads, display ads and Youtube ads.
Extensions : we are integrated with 30 eCommerce platforms. We have free and premium extensions. The free apps, provide great value for the merchants, and provide us with good leads we contact and offer the Traffic Booster. The two main free extensions are Benchmark Hero and Growth hero apps. One creates a free site audit and one creates a free Facebook ad account audit.
How are you doing today and what does the future look like?
The focus of the company is online advertising for eCommerce, we keep improving our AI technology for Google Ads.
We went from a developing phase of the Traffic Booster algorithm to an optimization phase where we keep improving it and keeping it up to date to the latest Google adjustments.
In the past year, we added to our AI the ability to set up and optimize Facebook and Instagram accounts. This is still in the works, there’s a lot of manual work we do, but most of the development work should be done by the 1st Q of 2020.
We have been profitable in the past 3 years with a 2x-3x growth YoY.
We charge our clients both for our fee and for their media budget and this way we have become a junction between our clients to Google and Facebook.
Our lifetime value to CAC ratio is 4:1
We expect to finish 2019 with $10M ARR
You need to ask yourself am I passionate enough to do this for the next 7-8 years? Building a company takes a lot of time.
Through starting the business, have you learned anything particularly helpful or advantageous?
We had a lot of mistakes in our journey, but the important thing for growing is to make more good decisions than bad ones :-)
Focus is key. It's easy to get distracted along the way, focus on your product run as many tests as possible to validate your product offering, if it's working great, keep pushing forward. If it's not working pivot fast, don't waste your time on a product that doesn't work.
We developed 12 apps until we found our winning app which is the Traffic Booster. I don't consider what we did as a full pivot but more as a company evolution process because we kept the same niche and the same target audience, but if I had to look back and change anything in our decision making we would probably have to ask ourselves better questions such as:
- Is the product innovative?
- What's the competition in that niche?
- Do you have a technical barrier?
- Do you have a marketing edge?
- How would you distribute the product?
- Can you build a valid business model around it?
We released the Facebook shop app in a great timing, we were first in the market so we managed to acquire a lot of clients, but the merchants didn't see enough value out of it.
The on-site promotion apps, provide amazing value but the competition is crazy in that niche, and a lot of competitors give this product for free just to get into the market.
With the Traffic Booster, we manage to answer all of the above questions; it is innovative, there are not a lot of good AI companies in this niche, such that circle all of Google advertising methods, so there's a huge technical barrier, we have a marketing edge, we can distribute it well, and a business model we can scale fast with!
What platform/tools do you use for your business?
We use the following tools:
- Zendesk is our support system.
- Trello for project management.
- Intercom, Mailgun and Madmimi for emails. Each ESP has it's own benefits.
- Google Analytics, Amplitude, Chartmogul for reporting and analytics.
- Missinglettr for social media activity
- Loom for video demos
- aHrefs for SEO
- Slack for communication
- Google Ads for advertising our clients and ourselves.
- Facebook Ads for advertising our clients and ourselves.
What have been the most influential books, podcasts, or other resources?
From Dan Ariely, we use the 3 columns pricing structure he recommends, displaying one basic plan one expensive plan, and in the middle, the best value plan, to have the clients feel like they made the best choice, while you got them to pay for the middle plan and not the most basic one.
Advice for other entrepreneurs who want to get started or are just starting out?
You need to ask yourself am I passionate enough to do this for the next 7-8 years? Building a company takes a lot of time. You need to have enough passion that you'll wake up every morning and grind all day and all night to get everything done.
You need to have the right partners with you, the ones that will run a marathon with you and not a sprint.
Are you looking to hire for certain positions right now?
Yes! We have team members in Tel-Aviv, Berlin and Silicon Valley, and we’re always looking to add great people to our team. The open positions are listed in our jobs section on our site.
Where can we go to learn more?
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