How I Started A $8.5M/Month Company Providing Marketing Solutions To SMBs

Published: September 4th, 2020
JB Kellogg
Founder, Madwire
from Fort Collins, Colorado, USA
started May 2009
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Hello! Who are you and what business did you start?

Hi, I'm JB Kellogg and I'm the Co-Founder & Co-CEO of Madwire®. I co-founded Madwire with my Dad when I was 28 years old and grew it from just the two of us, in a tiny little office, to over five hundred people and a hundred million dollars in annual revenue in under 10 years. I guess that's pretty rare to achieve, so they call companies like that "rocketship companies".

For those of you that don't know, Madwire's mission is to help small businesses grow and their local communities glow. Madwire does this by enabling SMBs and entrepreneurs to manage and grow their brand from a singular platform called Marketing 360®. At Madwire, I enjoy being a part of building a championship team that pursues championship performance and making a difference every day.

In between all the "madness" and spending precious time with my amazing wife and kids, I enjoy sharing tips and lessons I've learned over the years with regards to marketing, leadership, and more across my social media channels. Why do I do this? Because a lesson learned should be a lesson shared. If I can help just one person, I've increased my radius of impact while at the same time helping someone else increase theirs.

My wife and I at our annual company Orange party

What's your backstory and how did you come up with the idea?

I played college football at the University of Western New Mexico. It was like a full-time job, so after my senior season when football was over and I still had one semester left, I had a lot of time on my hands, which I was not accustomed to. I didn’t like it - I prefer to be busy. So, I decided to walk down to a local travel magazine company a few blocks off campus called Zia Publishing.

I knew I had a talent for design and marketing (I self-taught myself digital design and went to school for marketing), so I walked in and asked if I could intern there in my final semester. They said they didn’t require any design or marketing but they did need a new website. They asked me if I knew how to design and build a website. This was early 2005 and website design and development were still pretty new. I told them, no, but if they gave me a desk, computer, and a couple of months, I’d figure it out. So they did.

Over the next eight weeks, I learned everything I could about website design and development. I designed and built the website two or three times over before I felt confident enough to show the owner, Terry. When I showed her the website, she paused and said, “This is the best website I’ve ever seen. Not only is it beautiful, but it achieves all our needs and goals.” I knew at that moment I had a talent not many people had at the time. I told my Dad I thought there was a business opportunity. He agreed, but the industry was mostly freelance at the time and he was running a successful brokerage company called Traders Network and wanted me to come work with him and test some of the digital marketing and design strategies there first.

So we did. We redesigned Traders Network’s website many times, tested Google ad campaigns when they very first came out, created automated email marketing campaigns, developed online trading software, brokerage CRM software, and much more. We learned a lot.

In 2009, while working out during our lunch break as we do together every day, we started talking about how our strategies would work well to help any business grow, and how the way businesses were marketing was changing from traditional offline methods to new digital online methods. Exactly what we were successfully doing. Within that one hour workout, we came up with the entire business plan for Madwire and our mission of helping small businesses grow and the enormous impact that could have if we did it right.

Over the next three days following our “big idea”, we fine-tuned our business plan and strategy. The following Monday we decided to go all in. My Dad handed the brokerage company off to his partner, I gave up all my accounts, and we started Madwire in a tiny little office that barely fit two people.

My Dad (Joe Kellogg) and I share a few memories of the early days

Take us through the process of designing, prototyping, and manufacturing your first product.

The process of launching our platform, Marketing 360, was a long journey. We founded Madwire in 2009 and did not launch the first version of our platform until 2014, five years later. This was not because of a lack of effort, but rather, a lack of knowledge. We always knew we wanted to make Madwire a technology company and build our platform, but without any experience in the industry, we didn’t know what to build!

So, we started Madwire on the back of services. We offered a wide array of managed services to help small businesses grow including website design, branding, ad management, content marketing, social media marketing, email marketing, video production, and more. We planned to offer services to both earn revenue to fuel the business as well as learn exactly what the perfect technology to build would be. It took us about three months of solid planning and educating ourselves before we opened the doors for business.

The day we prepared enough to open our doors, we launched our marketing campaigns and then went to workout. When we got back from working out, we already had our first lead! So we called the lead, sold the lead for $190 a month, and that account is still with us today! We were so excited. This was going to work.

We’d often say that a client can cancel for a million different reasons, but let’s not allow one to ever be that we did not do everything we could to “wow” them in customer service.

Fast forward five years later. By this point, we’d worked with well over 5,000 small businesses and had grown the company to around 150 employees. We now had a strong understanding of what we needed to build in terms of technology that would both help our team become more efficient and scalable as well as what the small businesses needed to grow their business. It was at this time that we designed and prototyped the first version of our platform, Marketing 360. The initial development of the platform took about nine months. We launched it around September of 2014. It was at this time that we transitioned from a service company to a tech-enabled services company.

In 2016, we launched our second version of the platform which introduced business management related features and functionality, such as a small business CRM. This helped further move us toward a technology-first company, but we were still considered a tech-enabled services company at this point.

At the start of 2019, we began the development of our third version of the platform. The third version would take everything we learned over our ten years in business and create something truly transformational in the small business space.

A singular platform that would provide a business with everything they need to both manage and grow their business. The final version would transition us from a tech-enabled services company to a technology-first company.

In March 2020, we launched the third version of our platform. This was a game-changer for us. Since launching, we’ve seen tremendous growth and feedback from our over 20,000 small business users. We now roll out new features and functionality every Wednesday. We have a saying at Madwire that goes, “Every Wednesday the platform gets better.” It’s always exciting to see the new feature releases each week for our team and our active users.

The Marketing 360® platform has everything a small business needs to manage and grow their brand

Describe the process of launching the business.

As I said earlier, it took my Dad and me about three months of planning and preparation before opening our doors for business. During this time, we went through all the typical steps to starting a business. I created a video called 21 Steps to Starting a Business which essentially outlines the process we followed. I suggest watching it! But in a nutshell, we designed our brand, created our website, refined our offerings, price points, created our advertising campaigns, set up our internal CRM software, billings software, etc. All things that are needed before launch.

We have never done any cold calling or outbound sales campaigns. All our leads and customers are generated from inbound strategies. We believe in a multi-channel strategy that extends to social, content, reputation, advertising, email marketing, and beyond.

We didn't start the company with any official funding. Thankfully, my Dad and I were successful in the brokerage industry and had some money saved to sustain us until we were able to start driving revenue. But I did not have a ton of runway. Plus, I had a wife and four small children at home to support which, honestly, was a good thing for me. I had no option but to succeed. So, I attacked each day, each sales call, each client project, with passion and urgency. I wanted to blow their socks off in service so they signed up, stayed with us, and told their friends.

The passion of my Dad and I fueled our success. We opened almost every lead we talked to. We then fought like hell to keep every client long-term. We would not give up easily. If somebody wanted to cancel, we’d do everything in our power to prevent that. We’d often say, they can cancel for a million different reasons, but let’s not allow one to ever be that we did not do everything we could to “wow” them in customer service. It paid off and has been something our culture has been built upon...creating exceptional customer experiences.

We completely bootstrapped the company for the first five years until bringing on our first investment capital, although small, in 2014 to help support the launch of the first version of Marketing 360. We’ve grown to where we are today, including moving into our newest 127,000 square foot space in 2019, from that very first investment. We’ve been very capital efficient. It’s something we’re proud of. Our first five years, growing bootstrapped, taught us the value of using every penny wisely.

Madwire HQ (127,000 square foot building) located in Fort Collins Colorado

Since launch, what has worked to attract and retain customers?

One thing we say a lot at Madwire is “we eat our dog food.” Meaning, the very thing we offer to our clients to help them manage and grow their business, we do for ourselves! On that note, we have never done any cold calling or outbound sales campaigns. All our leads and customers are generated from inbound strategies. We believe in a multi-channel strategy that extends to social, content, reputation, advertising, email marketing, and beyond. I’ve put together a video on this topic you may find value in, 6 Building Blocks of Success. I encourage you to check it out!

Beyond that, I think the real key to success is simply building raving fans for your brand. You do this by creating exceptional customer experiences. There’s no better way to increase your customer lifetime value and to earn more referrals. I would encourage you to watch this collaboration video I recently did with some of our Madwire team members: How to Create Raving Fans.

My last piece of advice would be to invest at least ten percent of your projected revenue into marketing. We’ve found this to be extremely successful for us and the small businesses we work with over the years. For example, if your projected (target) revenue is one million dollars for the year, you should invest one hundred thousand dollars into marketing (around eight thousand dollars per month). By doing this, you give yourself the best shot at achieving your revenue goal.

This is me leading a seminar giving small business owners tips on how to grow their brand

How are you doing today and what does the future look like?

We are on a quest every day to get better in all areas of the business. We are working hard to increase profitability so we can build a long-term sustainable company that will last hundred-plus years. As a tech company, we’re focused on improving our gross margins into the 70-80% range by increasing our efficiency, scalability, and automation through technology.

We believe we’re on a path to a potential IPO in the next twelve to eighteen months. As such, we want to make sure we’re as strong of a company as we can be in any areas. But above all, we want to make sure we keep our focus on serving our team and our customers first and forefront. We believe happy people make happy customers, so culture will remain our top priority.

That said, we want to always remain focused on our mission of helping small businesses grow. We believe doing that one thing well makes the world a better place. Small businesses provide jobs, put food on tables, fund charities, support their communities, the list goes on. Thus, if we can be successful in helping small businesses grow, which we believe is by providing them the world’s best small business management and marketing platform, Marketing 360, the rest will take care of itself, whatever that might be.

At Madwire, execution excellence is our standard and our standard is non-negotiable

Through starting the business, have you learned anything particularly helpful or advantageous?

I have learned so many valuable lessons in business and life since starting Madwire, it’s insane. I’m still learning new lessons every day! But, I’d say the most valuable lesson is this…

Championship leaders build championship teams that drive championship performance.

It all starts with the leader. Championship leaders have four responsibilities and one priority. The four responsibilities are:

1) The Mission — Why you do what you do

2) The Vision — Where you’re going

3) The Strategy — How to get there

4) The Goals — The milestones you need to achieve along the way

The one priority is building a championship team. A championship team is made up of two key pieces:

1) Culture (mindsets & behaviors needed to drive championship performance)

2) Execution (skillsets & processes needed to drive championship performance)

If you have a championship leader leading a championship team, the championship performance part just takes care of itself.

I posted a video on Instagram here breaking all this down in under a minute if you’d like to check it out.

What platform/tools do you use for your business?

This one is a total layup for me - Marketing 360, of course! Not only do the small businesses we service use Marketing 360 to manage and grow their business, but we do as well! Marketing 360 enables SMBs to do everything from building a website, to accept payments, manage leads and customers, book appointments, manage online reviews, manage social media, manage business listings, manage content marketing, manage multi-channel digital advertising campaigns, and more.

Outside of that, we use Zoom for our phones, text, chat, and video conferencing. We also use Google Apps for email and their suite of cloud-based tools. We use ZenDesk for our online support and knowledge-base software. In addition to that, our software team uses a long list of the most modern and advanced technology tools.

Like those old HairClub for Men commercials, not only am I the owner of Marketing 360, I’m also a client!

What have been the most influential books, podcasts, or other resources?

I’ve created a few videos that hit on this topic that has worked well for me. I encourage you to watch Self Improvement - Strategy That Works & Saves Time (this one has been a game-changer for me) and Personal Growth and Professional Development - 9 Great Tips (lots of good nuggets in here).

Outside of that, podcasts and books on leadership, sales, marketing, and business are always recommended. If I had to pick one book that had a big impact on me early and one I would recommend to any new business owner, it would be Good to Great by Jim Collins.

Advice for other entrepreneurs who want to get started or are just starting out?

I created a video on this topic called How Do You Grow Your Business? - 10 Tips For Astronomical Growth. In the video, I break down these tips in more detail:

Tip #1 - Develop a company mission you and your team can stand behind.

Tip #2 - Invest in marketing (talent & technology, search, social, local, reputation, automation, CRM, and measure ROI).

Tip #3 - Be passionate about sales (measure opening ratio, avg account size, cost per account).

Tip #4 - Create scalable and repeatable processes (CRM, Google Docs, training materials).

Tip #5 - Hire people that fit your culture and align with your mission over people with experience.

Tip #6 - Measure people based on their attitude, effort, and performance — develop ways to measure that so everyone is at A and B player status!

Tip #7 - Listen to employee and customer feedback and make changes along the way.

Tip #8 - Hold an "all-hands" meeting with your team once per week (at least once per month) and be fully transparent with them with regards to where you stand as a company, your goals, areas you can improve, changes you're making, and more. (do this via Zoom if remote)

Tip #9 - Constantly be building future leaders that can become the foundation of the company.

Tip #10 - Remember, nothing is as good as it seems and nothing is as bad as it seems, but somewhere in the middle lies reality. Keep choppin'!

This is me leading one of our weekly all-hands meetings

Are you looking to hire for certain positions right now?

We’re always looking for good people in all positions, but we’re especially looking for talented software engineers right now. You can explore all our positions as well as apply online.

Where can we go to learn more?







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