Welcome to the final episode of our September Shabbat cycle! If you’ve listened to the show for the past few years, then you know we’ve entered our September Shabbat, where the band is taking a break from podcast production and airing a few of our favorites of the over 400 episodes they have aired so far.
FIRE. it has four pillars: financial psychology, investing, real estate and entrepreneurship.
In September, we will launch four weeks of episodes focusing on each of these four pillars. Today we’re broadcasting an episode on entrepreneurship.
When Rand Fishkin was 25, he had $ 500,000 in credit card debt.
Less than a decade later, Rand was the founder and CEO of a company that grossed $ 35 million in annual revenue.
In this podcast episode, Rand tells the story of his financial bottom and his eventual comeback.
The saga began in 2001 when Rand, then 22, dropped out of his final year of college to start a business with his mother.
His mom, Gillian, owned a small marketing company that helped local businesses with tasks such as posting ads in the Yellow Pages. (If you don’t know what this is, ask someone who is over 30 years old.)
Rand had an early passion for entrepreneurship and worked part-time for his mother’s company in the late 1990s and early 2000s. In his senior year, he was ready to go full-time diving.
Both Gillian and Rand realized that the internet is more than just a fad. Households have switched from dial-up modems to broadband. Customers were more interested in websites than in Yellow Pages ads.
The mother-son duo decided to start designing websites for local businesses.
In the years 2001-2004 they employed contractors, rented office space, hosted stands at conferences, and bought advertisements. Most of it was paid for with personal credit cards in the name of Rand.
By 2004, they had accumulated $ 150,000 in credit card debt. Then they went bankrupt. They could no longer make the minimum payments.
Interest and late payments have raised the balance to an astronomical $ 500,000.
They decided not to declare bankruptcy. Instead, they took a two-pronged approach: Rand’s mom spent the next three years negotiating with creditors, receiving large chunks of interest and waived fees in return for paying the principal balance. Meanwhile, Rand focused on growing the business.
Several of his clients needed help with a specific aspect of internet marketing called search engine optimization or SEO. Rand began researching SEO tactics and started a blog to share his findings. This blog attracted new customers and soon Rand gained a reputation as an SEO expert. He created a company called SEOMoz, later renamed Moz, to offer consulting services to companies.
After a few years, his company also began to develop and sell SEO tool subscriptions.
By the time Rand resigned as CEO, the company had accumulated multiple rounds of funding and generated $ 35 million in annual revenue.
But there is a difference between a company’s earnings and the personal income of its founders. Today, Rand and his wife still have a liquid net worth of less than a million.
How did Rand progress from $ 500,000 in debt to becoming the founder and CEO of a successful eight-figure company?
Why isn’t he a millionaire yet?
And what lessons about entrepreneurship and finance can he share with the world?
Find out in this podcast episode.
PS Rand’s wife Geraldine DeRuiter is a hilarious travel writer and alumni guest on this podcast. You can listen to her interview in episode 77.
PS. If you want to learn more about starting a blog, check out this free tutorial.
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