August 13, 2018

How I Paid Off $500,000 in Credit Card Debt, then Launched a Company with $35 Million in Annual Revenue -- with Rand Fishkin, Founder of Moz

1 hour 7 minutes

#145: When Rand Fishkin was 25 years old, he carried $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 shares the story of hitting his financial rock-bottom and making the ultimate comeback.

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The saga began in 2001, when then-22-year-old Rand dropped out of his senior year of college to grow a business with his mom.

His mom Gillian owned a small marketing company that helped local businesses with tasks like placing ads in Yellow Pages. (If you don't know what that is, ask someone over 30.)

Rand had an early entrepreneurial streak, and had spent the late 1990's and early 2000's working part-time for his mom's business. By his senior year, he was ready to dive in full-time.

Gillian and Rand both realized the internet was more than a passing fad. Households were switching from dial-up modems to broadband connections. Clients were more interested in websites than Yellow Pages ads.

The mother-son duo decided to start designing websites for local businesses.

From 2001 to 2004, they hired contractors, rented office space, hosted booths at conferences, and purchased advertising. They paid for most of this with personal credit cards in Rand's name.

By 2004, they'd accumulated $150,000 in credit card debt. Then they defaulted. They couldn't make the minimum payments anymore.

The interest and late fees grew this 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, getting big chunks of the interest and late fees waived in exchange for making payments on the principle 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 clients, and soon Rand developed a reputation as an SEO expert. He created a company called SEOMoz, later rebranded as Moz, to offer consulting services for businesses.

After a few years, his company started developing and selling subscriptions to SEO software tools, as well.

By the time Rand stepped down from his role as CEO, the company had raised multiple rounds of funding and was collecting $35 million in annual revenue.

But there's 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 that's less than one million.

How did Rand transition from carrying $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.

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P.S. Rand's wife, Geraldine DeRuiter, is a hilarious travel writer and an alumni guest of this podcast. You can listen to her interview in Episode 77.

http://podcast.affordanything.com/9-years-nonstop-travel-geraldine-deruiter-everywhereist/

P.P.S. If you'd like to learn more about starting a blog, check out this free tutorial.

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By Paula Pant | Cumulus Podcast Network

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