Dush Ramachandran 4:06
great. First of all, john, thank you so much for having me on your podcast. It’s an honor and a privilege and I appreciate it. Appreciate your time and that of your audience. So, Clickbank is a marketplace for digital products. So let me give you a very simple example that would explain how Clickbank works for any of your listeners. So let’s say you’ve created a video course on how to perfect your golf swing. Let’s just say that, right? And it’s it’s a set of videos and you want to get it out to the market. Now you’re you’ve got several challenges to begin with. First of all, where do you find the traffic? Who is good, I mean, all of the people that are interested in improving their golf swing need to find your product to be able to buy it. So first is finding customers, the second is accepting payment. Most people who are just starting off, don’t really have a merchant account or the ability to accept credit cards and things like that. And even if they did, they don’t have the reach to accept credit cards from various different countries. So you might find somebody in Australia who might be interested in your golf swing product. But you know, they can only pay in Australian dollars and you don’t have the ability to accept Australian dollars. So that’s one of the challenges. And another is paying taxes. When you know a lot of countries and a lot of states even products that are sold are subject to sales tax or value added tax VAP or goods and services tax. So the seller of the product has the obligation to collect and remit these taxes. And as an individual if you’re if you’ve just created this product, how on earth are you going to find how much to collect for each each location and then who to remit that too. So all of those problems are taken care of by Clickbank. So Clickbank is a marketplace where you can list your products for sale. And affiliates who are people on the internet who promote products, other people’s products and earn a commission when those products sell are able to find products on Clickbank and promoted to their audience. So you list your golf swing product on Clickbank, and let’s say, I happen to be someone who has a list of subscribers that are interested in golf. And so I pick up your product, and I send out an email to my list and my list gets the email. They’re interested, they click on the link, they come to the Clickbank site, they and they come to your sales page, when they click Buy. They get taken to the Clickbank order form. They put in their credit card information, Clickbank collects their payment, and then this versus the payment to everyone involved. So the affiliate that promoted in this case in this scenario was me that promoted it. So I get my share, you get your share, and Clickbank takes their piece of the action. So it’s a it’s a very simple, easy to use marketplace for digitally downloadable products.
John Corcoran 7:16
Yeah, and and that’s what’s so attractive for me about it is that it took something that was so complicated as you laid out. And it made it so simple, so simple. So you just could focus on other pieces of the puzzle. And there’s no shortage of different pieces of the puzzle when it comes to, you know, if you’ve been in a brick and mortar business, and you’re trying to figure out how to make it work selling something that’s ephemeral, like a digital product online.
Dush Ramachandran 7:43
Exactly. And the other challenge, of course, is also taking care of all the other details like customer service. So what happens if somebody who buys your product is not able to get it to work or the link doesn’t work or whatever, there could be 100 problems, or they don’t like to play I want to refund. Now, as an individual entrepreneur, it becomes really difficult for you to manage customer service payment, tax collection, all of these sorts of things and Clickbank takes care of all of those things. And you can just focus on what you do best which is creating your product, which you’ve had the good experience of doing so right that so that that is in essence what Clickbank does. And so, Clickbank sales depends on the sales of the products that are sold through Clickbank. So all of these different products like this, the tennis, the golf swing product that might be a product related to back pain. There’s another product related to how you trade in stocks and bonds. There’s products of all kinds. They’re on the Clickbank marketplace at any given time, there are between 35,050 thousand products. And there are further hundred and 50,000 products that are not featured on the marketplace. So and they have an active active strength of about 200,000 affiliates worldwide. Wow. Look these products. Yeah, so it’s a it’s a really, really strong, vibrant marketplace. And back in the day, one of the things that we used to say was somebody somewhere in the world buys a product from Clickbank every three seconds. So that was that was kind of the volume.
John Corcoran 9:29
Yeah, yeah. It’s amazing. And so what what were your challenges you joined in 2005. And you give me a little bit of backstory beforehand, you had been with little talk about Bob King, I think it was his name, who came in as a new CEO because he’s an interesting story.
Dush Ramachandran 9:47
Yeah, so Bob King was hired into Clickbank in 2005, primarily with a goal of rapidly growing the company. Clickbank had been growing reasonably well. And the the founding, the original founding team decided that they needed a professional management team. It was a husband and wife team that that had originally founded the company. And they pretty much ran the company themselves. They had, you know, a small team of employees that helped them with various things. And so they went looking for a CEO that could that was used to high growth environments and could really take care of the company places. And so BB King’s background was that he was a CEO of McKesson, which is the the famous medical supplies company. And he was responsible for growing McKesson from about I think it was $16 million to over four and a half billion dollars, wow, for a period of 10 or 12 years. And then he left McKesson and went to corporate Express. And corporate Express was a small local cool office supplies company based in Broomfield, Colorado. And through acquisitions, and through organic growth. He grew that company from 16 million to over two and a half billion and then sold the company to a Dutch office supplies company. So he had been he had always been through these high growth companies. And he had built a reputation for himself for growing these companies that are dramatic rate. So they brought him in. And Bob King had previously in a company that he’d worked for before, called requisite technology, bought a company that I had started in Toronto, Canada. And so and we grew the combined company, and we sold that company. And so when he moved to Clickbank, he said, Look, you know, I’ve been charged with growing this company, and you’ve done something similar. Why don’t you come over and help me run sales and business development for click. And so that’s when I went over to click back in 2005. And so during my time at Clickbank, we’re able to grow the company about 500%, in six years. And we reached a couple of pretty significant milestones. The first was, we reached a milestone of a billion dollars of payouts, to product vendors and affiliates. And in my last three years there, we double that to $2 billion, which is pretty significant milestone. And so that that was a that was a really interesting time.
John Corcoran 12:36
It’s an unusual, you have unique challenges when you’re building a marketplace, right? Because they’re both sides of the equation, you gotta build out, right. So what do you focus your energy on?
Dush Ramachandran 12:48
You know, that’s a really good point. One of the challenges was course, you needed to grow the number of sellers selling products, and the number of affiliates and they had to move sort of Illinois do they build too, if you do too much a one side or the other than that, that’s how it gets frustrated. And it gets lopsided, because, you know, there are too many too many vendors and products, not enough affiliates to promote them, or you have too many affiliates, not enough product for them to promote. Yep, so those two things have to move sort of in lockstep. So one of the one of the interesting things that happened during that time was a lot of the product owners, or vendors, as we, as we call them, also became affiliates. Because prior to the early in sort of the mid 2000s, like 2005, 2006, there were a lot of pure affiliates that didn’t have their own product. But they either did Facebook advertising, or Google, this is before the Google slaps and so on and so forth, where they could be, PPC was actually a very cheap source of traffic back then. So, so there were a lot of people that got a lot of traffic from from Google. And they were pure affiliate. So over time, that gradually changed where these people started to develop products of their own. And they built a sizable list of customers and prospects and opt ins, that they would act as an affiliate to. So they would promote other people’s offers to their list. And so that was a way by which when you added a significant number of vendors, they also doubled as affiliates. And so you kept growing both sides of the business. So that was that was an important you
John Corcoran 14:35
focused on that. Yeah. Okay. All right. What other challenges did you experience during that period of time? You said it was about 100 million dollar company when you joined Clickbank?
Dush Ramachandran 14:45
Yeah, yeah. And when I left, you know, about five, but yeah, run rate of 550 million. Yeah. Now, one of the, one of the big challenges, of course, was making sure that refunds across the entire network stayed at under 10%. And charge backs stayed under 1%. Obviously, because, you know, once your chargeback start to creep up above 1%, you become categorized as a high risk vendor, by the credit card companies and your processing rates go up. Now, the the rates that you charge clients rates that click bank charges, clients are pretty much fixed. So if your if your rate that you are charged, rise up to meet what you’re charging your clients, then obviously your margin is affected. So that was one of the big challenges. So obviously, a big quality push, making sure that one, the products were of good quality, and therefore didn’t get a lot of refunds or charge backs, and educating vendors on how to provide better customer service. Because one of the things that we found after reading, researching a lot of this was that a lot of the refunds and charge backs were not because products were necessarily bad. They weren’t. But it was because of poor customer service. And, you know, people are a lot more comfortable buying things online now. But back in 2005, we’re talking about 14 years ago, yeah. You know, people are fairly leery about buying online. And so if they bought something for, say $40. And, and they they they went to use it and they found they needed some information to call the vendor, and the vendor didn’t pick up the phone. Immediately, all panic would break out. I’ve been scammed. So yeah, refund. So improving customer service is a very, very important thing. And then of course, the other factor that we found was that whenever you include a physical product as part of the shipment, that brother down refund rates considerably, because because people felt like there was something of value that they got it was it could be a backup copy of exactly what they bought digitally. But it was a printed book or a CD or a DVD that made them feel a lot better. And so that dramatically reduce refunds.
John Corcoran 17:18
See encourage people to mail them mail out something I imagine.
Dush Ramachandran 17:22
Yeah. Or include include in the in the original order a backup copy, or even offer that as an upsell. Yeah, a lot of the vendors did.
John Corcoran 17:33
Yeah. Now you since Clickbank, you’ve run you built up a affiliate management business and you’ve worked with a number of different companies. Like a Gora financial those who don’t know a Gora, it’s one of it’s a huge company that does newsletters and publications and things like that. You also worked with Genesis digital which makes Webinar Jam which I’ve used for years is great product. Tell me about building up that business obviously built on your experience having worked at Clickbank,
Dush Ramachandran 18:09
right and you know the processes systems and people it’s it’s it’s also connections with people that you that you built a long trusting relationships with lots of affiliates. And so that’s been that’s been a significant part of the business. But essentially, what we do in the affiliate management business, is we create an affiliate program, go out and find affiliates recruit those affiliates and manage those affiliate relationships going forward. And, you know, we, initially when we started the business, we thought, you know, this, this as an agency model, this could grow pretty much indefinitely, you could have, you know, 30 clients, 50 clients, 100 clients and just keep building the team. We started to grow, we discovered that that really didn’t work. Once the number of clients went beyond 10, the quality of the service began to suffer. Because our services very, it’s like concierge like service where it you know, it’s very high touch. And because of that, you know, I personally get involved in all of our clients, campaigns and programs. And so, so now we’ve, you know, over the last several years, we’ve restricted the number of number of clients, we take on to 10, we don’t take on a more than 10 clients at any given time. And so because of that, we have to be very particular about the kind of clients we take on because we can’t afford to have, you know, non performing clients, right, we can get all the traffic in the world. But if the clients product doesn’t convert, it’s not much we can do about it. Right. Right.
John Corcoran 19:58
Right, is that led your decision to shift? So you’ve got the net momentum is your current business that you’re focusing on? And also the accelerator network as well as that would? What influenced that decision?
Dush Ramachandran 20:14
Two things. Yeah, exactly. So so what we discovered as we as we continue to grow, the net momentum was that, you know, if if clients products didn’t convert, then they didn’t do well, we didn’t do well. So that caused us to launch a funnel design and copywriting part of our business. So we do a lot of funnel work for our clients, we write their sales page copy, and we test it and make sure that it converts, and then we take them on as a client. So that’s that’s one, the accelerator network is basically a mastermind is part mastermind, part, group coaching, part mentorship, primarily intended for people that just getting started trying to figure out, you know, how do I how do I really get value out of this? How do I take this product to market? So that’s what we’ve been trying to help people do. Based on all of the experience, we’ve had seeing thousands of launches, hundreds of sales pages, in kind of boiling all that down to best practices.
John Corcoran 21:22
Right. Right. And I know a lot of your focus has been on working on working with larger companies. So you know, companies that are in the five to $20 million range. Is that correct? Okay. Yeah. up to 100 million. So tell me about the unique challenges that these businesses face at that level, maybe they’ve just gotten to 5 million through sheer grit and determination. And they’re at that point where they’re needing much maybe like Clickbank, years earlier, they needing professionalism.
Dush Ramachandran 21:55
Yeah, they need systems and processes. You know, usually when they get to the $5 million level, it’s, it’s the original founders. And it’s basically grit and determination, the it’s the blocking and tackling the founders working 1618 hours a day, getting things done. And you know, the the old, the old saying about what got you here is not going to get you there is very true in this particular case. Because at this point, now you’re starting to grow your organization, you need management, you need the ability to motivate others, you can’t do everything yourself, you could when you were to $3 million company. But when you’re 510 $15 million companies need to start to build a team. So hiring, firing, and then even things in terms of business models. Some some businesses work great in the zero to $5 million range. But beyond that, it’s very hard to scale those businesses. So. So what do you do? How do you scale those businesses scaling comes with some sets of unique challenges, that people get very excited about the idea of scaling their business, but don’t often think about what’s actually involved in scaling a business. How do you take a business from, say, 100 million to 500? million? What are some of the challenges involved? And I’ve been, I’ve been, you know, involved in taking your business from zero to 50 million, which I did my own business before I sold it. And so there are all these different challenges that come up. And will be we’d love to do is to help entrepreneurs think through those challenges, along with a group group of other entrepreneurs that can combine work with mastermind, plus providing mentorship and guidance and coaching in that area.
John Corcoran 23:47
Yeah, well, I think, you know, based on your experience, I think that’s going to be a tremendous resource for for everyone. So I want to thank you dish for for coming and talking to me. This is really interesting. I want to wrap things up with question that I always asked, which is, let’s pretend we’re at an awards banquet, much like the Oscars or the Emmys, and you are receiving an award for lifetime achievement for everything that you’ve done. You’re walking down, people are applauding, you’re about to accept it. And what I want to know is, who do you think who are the the mentors, the friends, the business partners, the colleagues, the peers? Who are the people that you would acknowledge in your speech for everything you’ve done up until this point?
Dush Ramachandran 24:25
Sure. Certainly, I would, I would point to Bob King. Because he, you know, we worked together in two companies, when he bought the company that I had created, and then later a Clickbank. And in both those situations, we literally blew those companies up in terms of sales is a terrific leader, and a visionary. So he was he was a significant factor. Plus, you know, lots of other people. Now, obviously, I would name my wife, Tara, who’s been my constant companion and supporter and cheerleader, and providing, you know, real solid sounding board for when we’ve run into challenges or issues. She’s always a great person to talk to. Yeah, and there have been, you know, countless other friends and colleagues and co workers who, you know, have helped along the way and nobody achieves I do believe nobody achieves anything entirely by themselves. It always takes friends, associates, colleagues that help you along and people like you, john, you know, just, you know, talking with you the other day gave me a bunch of different ideas. And that always sparks innovation. That’s always helpful.
John Corcoran 25:42
That’s how that’s true. And that’s why I love you know, this medium because you always, you know, yeah, I mean, you get to you get great ideas, and I call it personal and professional development that doubles as marketing because you’re constantly educating yourself while you’re educating your audience. The net momentum dot com is the website anywhere else people should go to learn more about you dish.
Dush Ramachandran 26:05
I think the net momentum calm is a good place to go. We’re we’re actually building a couple of other sites for one for accelerator network, and the other one called dish and Tara calm. Which, you know, Tara is working on some personal development projects. I’m working on the accelerator network and we’ve got the net momentum. So it’s, it’s a place where we bring it all together. Okay, so,
John Corcoran 26:27
okay, great. Excellent. Alright. Thanks so much.
Dush Ramachandran 26:30
Thank you. Thanks, John. Pleasure being with you. Thank you