The Bit.ly Factor – A Service That Manages 40,000 Of The World’s Biggest Brands And Has Eclipsed 7 Billion Clicks

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Join me as I talk with Bitly.com CEO Mark Josephson. Mark has a 20-year history working with start-ups and new media. He launched his career at an agency with exposure to an eclectic mix of clients before following the skyrocketing growth of new media. Bitly exploded with the rise of Twitter when the business saw a need for shortened links. But Bitly took link shortening leaps and bounds further with tools to help marketers and brands study their customers’ online habits in-depth.

  • To date, Bitly shortens 500 million links with up to 7 billion clicks every month.
  • 40,000 of web’s most important brands use Bitly to help manage its online presence.

 

Key Takeaways:

  • Mark encourages marketers to study value propositions and audiences with an eye on what’s working and what’s not, and figuring out a segment you can own.
  • Explores how finding a market is a skill every marketer needs, closely followed by realizing an opportunity and understanding what problems you’re solving.
  • Discusses how positioning a company s in the “upper right quadrant” is a huge part of a CEO’s position to drive vision, product development and momentum.
  • Warns against AB testing your vision statement, and making sure every word counts.
  • Shares how Bitly isn’t just a freemium tool, and how the company looks at how, when and where links get shared.
  • Talks about Bitly’s main revenue driver that helps marketers leverage and control brands all the way down to their links.
  • Gives insights on why marketers can’t afford to give-up 15% of a tweet to a link, and how Bitly can help optimize every last character.
  • Reflects on how successful businesses build products everyone uses and loves.
  • Explains how Bitly builds business by augmenting data, giving companies bigger and better understanding of how people use the web.
  • Insights on mobile driving growth and representing half of all Bitly clicks.
  • Why acquiring your first 100 users is really about hand-to-hand combat and understanding needs and proposition.
  • Straight-forward advice on building an enterprise level volume of business through clear, concise messaging.
  • Shares building a talented and empowered team is the real role of a CEO, and not to do everything in the company.
  • Discusses universal truths of how marketers are always chasing the next level of optimization.
  • Stresses the strategic and moral imperative for every marketer to truly understand ROI across every medium and channel.
  • Speaks to social marketers only focused on engagement numbers and reach.
  • Why the best businesses are aligned with the success of their customers.
  • Embracing ruthless prioritization to get ahead and grow business.
  • Questions to ask yourself to gage if an employee is smarter than you, and how either answer could make your job harder as CEO.
  • Recommends not to start a company because you think it’s a good idea, do it because you have no other choice.

Definitions:

  • CPM – An advertising term to show the cost per impressions, often broken down to each 1,000 impressions.
  • ROI – The return of investment, or ROI, is a performance measure to show the benefit of an investment or to compare the efficiency of various investments.
  • Decodes – The action of clicking on a shortened Bitly link and it opening a web page.
  • Growth hacking - Somebody who’s contributions are measured against the impact they have on driving growth.

Mark’s Recommended Resources: 

Transcript:

Eric: Hi everyone and welcome to this week’s edition of Growth Everywhere where we interview entrepreneurs on business and personal growth tips. Today we have Mark Josephson from Bit.ly, he’s also CEO. So Mark, how are you doing today?

Mark: I’m doing great Eric. How are you?

Eric: Doing well. Thanks for joining us. So Mark, can you give us a little background on yourself first?

Mark: Sure. I have spent the past twenty years building startups in New York and in new media space. I’m a New Englander and a Boston Red Sox fan by heart, by breeding. Live in New Jersey with my wife and family and work in New York City.

Eric: Nice. Great. So, twenty years in the startup space and it’s been said that you are a pre-eminent startup executive. How does one go from starting, you know, let’s say someone’s, you know, say twenty-fivish, they’re a director of marketing on a startup, how do they become a Mark Josephson?

Mark: Oh God! Did my mother send you that? [laughter] Look, I started off working in an agency environment where you get access to and exposures to lots of different clients and lots of different businesses and iet was very clear to me, when I was working on sporting goods in consumer products, on one hand, and new media businesses getting a seed in [ARON 0:01:09.8] funding, one was moving slowly and one was a rocket ship. I think it was the Sheryl Sandberg quote that, “If someone offers you a seat on a rocket ship you don’t ask which seat. You get on the rocket ship.” So, I made the decision to get as close as possible to growth opportunities and then try to leverage my skill set and work as hard as I possibly could to find opportunity in there. So, I think you have to align yourself with growth opportunities and get as close to those as possible.

Eric: Got it. Your background is in marketing right?

Mark: Yes.

Eric: So, can you tell the audience…There’s a big difference between being a marketing executive and a CEO. Can you kind of walk us through that?

Mark: Yeah, there’s a big difference, but I don’t think it’s as big as people think. I think the things I learned as a marketer and being trained as a marketer are understanding value propositions and audiences and being able to understand what we do really well. It starts with the opportunity, right? It’s like, what does the market say, where’s the market opportunity, what’s working, what’s not, and where’s the segment that you can move to or own? You’re always doing the four quadrants and you always want to be in the upper right. So, defining the market is a skill that marketers need to understand and train and skilled marketers know how to do, and then you see opportunity. And then, as a marketer, you have to understand what you’re great at as a business and a product, and what problems you’re solving for people, and understanding how to position that in a way that puts you in that upper right quadrant, however you define it.

And so, understanding that is like a huge part of being a CEO because that’s how you drive vision, and that’s how you drive product development, that’s how you drive momentum, right? The pieces that you have to augment that with is, sort of, how to communicate that, how to define that in a strategy, how to recruit, and train, and motivate people. That’s different. But I will say what I learned as a marketer absolutely helps me do that every day. Clarity and consistency of messaging, speaking with one voice, understanding what you do well, what you want to do well and saying that consistently, you know, A/B test your vision statement, but you know that you need to make every word count and how that kind of focus on the detail of that, which you learn as a marketer.

Eric: Couldn’t agree more. A lot of this stuff carries over. So, let’s talk a little bit about Bit.ly right now. How many…whatever your key metric is, how many embeds are you getting per day? Can you give me some kind of scale you guys are at today?

Mark: Sure. So, I know that everybody knows that Bit.ly’s been around for a little while. We started in 2008 when social started, particularly with the explosion and growth of Twitter. Twitter turned out to be this amazing platform for sharing links and the links are long and the world needed shorter links and we were there and we solved that problem to shorten those links. But what we do, and what we’ve done from the start is really, look at not how those links get clipped, but how they get shared and what happens to that link when it gets shared around the web. That’s what we were really interested in. We actually don’t talk about the number of shortens that we do, we talk about the number of encodes; how many links are we encoding in our platform on a regular basis. Because we take that very long link and make it very short by wrapping it in our code. It basically becomes a smart tag that goes everywhere your [inaudible 0:04:41.8] does. So, we’re really big to the point where we’re encoding about five-hundred million links a month.

Eric: Wow!

Mark: And those links are generating up to seven billion clicks per decodes a month.

Eric: Wow!

Mark: So, we’re seeing decodes or clicks out of…significant number of clicks out of every single social platform, every single media site, every publisher, ever brand site, in just about every country in the world. And we’re doing that and correlating decode activity and profiling against…across property. So, we’re able to look at a click history against different properties and across the web. And another key metric for us is how many brands we work with. We’re working with over forty-thousand of the world’s most important brands to help them manage their social presence. And it’s on a premium model so we have some at the top who are using our tool set for free and that’s wonderful and then we offer more valuable products, and services, and insight as you work down into more deeper relationships.

Eric: Cool. Got it. So, it sounds like there’s a premium model and there’s a paid model as well. What’s the main revenue driver today?

Mark: Yeah. So, the main revenue driver is a product we call Bit.ly brand tools and Bit.ly brand tools is a suite of features to help marketers leverage and control their brand across their content and all their social strategies and then optimizations and insights to help make it perform better. So, we’re particularly focused on the power of the link. We believe that the link is a fundamental, an elemental piece of all marketing campaigns and all brand strategies and we give you the tools to maximize the power of that link. So, it starts with branding and the branded short domain. So, as you scroll through Twitter and you see ES.pn and NYTI.ms, and AMZN.to, real brands with short domains that represent their brands, that’s actually us running that for them. That’s a product…we manage that brand short domain for them and every marketer knows that you need to brand everything you do and you need to be consistent.

And interesting stat is that fifteen percent of a tweet is the link and if you think about one of the things that we do is we give every marketer the ability to optimize the performance of that fifteen percent. If you ask any marketer, “If I gave you fifteen percent more characters in a tweet could you make that work better?” and the answer is, of course, “Yes.” So, it starts with the brand and the brand is short domain. And the second part is for optimization so we give brands the ability to customize about half of the domain, so think ES.pn/superbowl, or AM.zn/coupon, or back to school, and manage that as a creative process and a creative product, but also give full stats and detail and insight on how those perform so you can A/B test and you can manage those links and that performance over time. And all of those: the branding and the optimization, is fueled by all of the quick tracking and demographics, and psychographics, and geographic, and data that we funnel up and give to make that all work better. So, we have forty-thousand brands who work with us at the top and a subset of those who pay us for deeper products in Bit.ly brand tools at the bottom.

Eric: I checked it out. My impression of Bit.ly as market before it was a premium tool that I’d use to check out my links and see how many clicks I’m getting but it sounds like there’s a lot more implications than that now.

Mark: There’s so much more to do and any marketer who cares about what happens to their link, what their links look like and how they perform, use Bit.ly.

Eric: Got it. And you guys just partnered up with Moz as well. Can you tell us why you guys decided to do that and how it’s going to help people over all?

Mark: Sure. So, we’ve been building this business for five years and I think some of the best companies out there are ones that focus on building a product that everybody uses and loves, like you mentioned, a lot of people think we’re a free product, that’s fantastic and we’re happy to do that, but while we’ve been doing that we’ve been able to amass a data set that’s pretty much unparalleled. Because we are doing such volume on the decode side in such a horizontal and ubiquitous way, we have a differentiated view on how people use the web, unlike traditional ad networks or data cookie companies, we actually see what happens at the click, so we’re able to see where you were, what you click, that you clicked and where you went, and run science and algorithms and data and update that data to help make that a richer understanding. So, we know how people use the web. Part of what we’re trying to do from a shareholder maximization standpoint and building the value of our business is: “Where can we take some of that data and help other business make better decisions? By letting them have access to that data.” I know that Rand, you spent time with Rand on this show, Rand is one of my favorite people and Rand’s business is helping marketers understand SEO better. Part of what we see is; we see some people license the Twitter stream to see which links are being shared to understand that as a proxy to popularity.

We actually know a deeper level in that. So, we know what links are being clicked on, not just the ones that are being shared, so it’s another level down the funnel, and that shows intent and that shows popularity in a way that nobody else can do. So, we made a portion of that available to Moz to help their customers make better decisions.

Eric: Wow! Got it. Okay. That’s awesome. So, seven-billion clicks or decodes a month, what’s fueling, what’s driving growth today.

Mark: Mobile. At the top line of our click growth is mobile. The explosion in mobile and people are consuming much more in mobile. We saw a very distinct tic last year when Facebook made the move to go mobile; almost mobile only, and we saw a direct correlation increase not only in Facebook clicks, but every click off of mobile. About half of our clicks are from mobile now.

Eric: Wow. Okay. I guess, backtracking a little bit, how did Bit.ly acquire its first one-hundred users? I usually like to ask about the first 100.

Mark: The first 100. Well, I wasn’t here for that so I’m going to assume…The first hundred users are hand to hand combat, right? You’ve got to really understand the needs and the proposition that you can fulfill for them. I don’t know if it’s the first hundred or the first ten depending on the scale of your business, but as a marketer, as a small business owner, somebody driving a business, if you don’t know exactly what those people are buying and why they want to buy it, then you’re not going to scale it.

Eric: Yup. Wow! Okay. Cool. I like that expression, hand to hand combat. People say, “Do things on scale.” but this is a new phrase that I think I’m going to steal.

Mark: Well I think…Be my guest, I didn’t make it up. But, when I think of scaling business, and this is my fifth startup and most of my experiences in taking other people’s really great ideas and scaling them…Anybody whose just coming into a business or starting a business, like you have to get to the point where it’s going to scale over time so that it can be repeatable, it has to be measureable, you have to be able to measure it so you can optimize it and repeat it, but when you’re starting something and if you don’t know people are going to want the yellow version or the red version, you’ve got to try them both, to get in there to really understand it, the first ten or the first hundred, depending on the scale of your business as an entrepreneur.

Eric: Got it. You know, you just said something that really interested me because I came in and I took over this company as well, so it’s almost the same thing for you. So, when you came in and you took over, what were some of the initial challenges that you had to face? Was there any resistance, like, what did you have to go through?

Mark: It was made really easy for me by the investors and we did a slow intro and ramped up over time. But I think that anytime you…This is not about me. This is about anybody coming into a business; that hired in to run a business. You really have to understand what…First off you have to understand what you’re trying to accomplish, so you have to be aligned with the investors, you have to be aligned with the management team to understand what the objective is. And then I think you have to be willing to go in and make some hard decisions about what we’re doing and what we’re not doing. I think one of the things Bit.ly is really best in the world at; we’ve built an amazing scale and enterprise level, volume, and we have a significant…a statistically significant portion of all the web’s traffic which routes through us on a daily basis. That’s rock solid battle tested unbelievable, but I don’t think we’ve taken it to market in an effective way from a commercial standpoint so that’s change. Change happens in all businesses. And so, I think, from a leadership standpoint, you can’t be afraid to…you can’t please everybody all the time, but you have to do what’s right by the business and have a clear and consistent message of what you’re trying to do.

Eric: Agreed. Consistency is key. So, in terms of your day to day, you know, the transition from being a marketing executive to being a CEO, you say it’s not that different, but what does your typical day look like.

Mark: I’m not sure there is a typical day. One of our investors, who I read something that he wrote about; that every CEO should have more than fifty percent of their day scheduled before they walk in, and I aspire to that, but it’s kind of hard to have that happen because, I think, the key thing as a CEO; I think you need to build a great team and build a team of people who are running the business and my job is to support them and make sure that I’m helping them to be really affective, whether that’s on the sales side, marketing side, product, engineering, people, it’s: how can I use my time to make them more productive? So, I think a lot about that. I don’t want the decisions to be made by me. I want them to be made by really talented people who feel empowered and close to the business and close to the product and understand it. Thinking about how to make the company and the team more effective is how I want my typical day to be, that’s not always the case. There’s always fire drills, but my job as CEO is not to do everything. It’s to create the team that does it amazingly well and make it look effortless.

Eric: Got it. You know, it’s interesting, Fred Wilson said, he was an investor, he like, ‘The three main things a CEO needs to do is: focus on recruiting, vision, and money in the bank.

Mark: And money in the bank. So, Fred, there’s nobody smarter or nicer than Fred. Fred was an investor in my last company, he was on my board, so I learned a ton from him and how he…and continued to. So, I agree. It’s the team and its funding and its vision; consistency.

Eric: Cool. Great. Let’s step back over to the marketing side. Obviously you’re very seasoned in marketing. What do you see, where do you see marketing going today, let’s say in the next five years?

Mark: So, I think there’s some universal truths that I’ve learned in the past fifteen, twenty years, working with marketers and being a marketer myself, the first is that; every marketer is going to chase the next level of optimization. So, it started off as key words, than it became behavioral, and it might be…there’s always…anything that I can do as a marketer to turn the dial to improve my hour ride, to improve my conversion, improve my results, I’m going to try. I’m going to do that. So, I think that as a provider or as somebody in the market you always have to be aware of what’s next and you can’t be fighting last year’s battle. Fighting a battle on display, premium display today is not as important as fighting a battle on mobile, or alive, right? Thinking two buzzwords, right? You have to be thinking about that because marketers are always going to go after that next level of optimization and I think that’s really important.

I think the other thing that’s has played out in other media, different media that I’ve seen, is that it is a strategic and moral imperative for every marketer to understand ROI. Saying that we’re looking for more engagement, we’re looking for more reach, and saying we have this many fans or followers or we’ve got this many page views or impressions, is irrelevant. I see that changing, you saw that search went to display in a very short amount of time. Like, that happens across everything and it’s only going to more so. It doesn’t mean that there’s not a tremendous value in brand, because there is, because brands win every time, hands down.

And brand is really important, but you measure brand as well and you can put a metric on ROI on brand and I believe that across every media and across every medium and across every channel you have to be able to track ROI, you have to be able to prove you spend a dollar and make ten because you can, and that puts a ton of pressure on the economics of lots of different business, publishing businesses, and intermediaries, agencies, but it’s happening in the same way that Jeff Bassos says, “Amazon didn’t happen to your business. The Internet happened to your business.” to the companies that are impacted by [it]. The internet and ROI is going to happen to every marketer and you have to be…you have to know it. The subset of that is knowing your math. Marketing is arts, Marketing is science, like they’re the same thing. You have to increasingly understand your math and if you don’t you’re dead in the water.

And then I think the third thing that’s really important to understand from a marketing standpoint is that you have to be…I think a lot about success and the success of our customers and the success of our business, they have to be aligned. I think a lot of the historical media business were about building a great audience, obfuscating the metrics underneath that and selling a high CPM to deliver that audience. Now there’s lots of ways to reach an audience and it’s unclear at best how differentiated they are. So, I think the best businesses are aligned with the success of their customers. And so, if you’re working with a search provider or a CPA firm, or whatever it is that you might be doing to acquire customers or reach your customers, I would look for ones that are on a performance basis over time and try to align yourself with people who do better when you do better.

Eric: Yup. Totally agree with that, which is something that we, as an agency increasingly try to do, you know, on all these paid advertising sites. So, what do you say to…You brought up something interesting to me that kind of stuck to me. You said, focus on ROI, which is music to my ears, right? But what do you say to the social marketer’s that are like, “Promoting content and it’s more about engagement. It’s about reach. You can’t measure ROI there.” What do you tell those social marketers?

Mark:  I say get ready because that stuff is only going to last so long. There’s great companies and we spend a ton of time talking about our ROI and being able to demonstrate that for our customers, but it’s coming. If you think you can hide behind reach numbers and engagement numbers without understanding what it actually does for your business, then, I don’t know if it’s tomorrow, or this afternoon, or a year from now, the companies and brands that are going to win are ones that are spending money and time and resources in a smart fashion that actually impact their business.

Eric: Cool. I agree.

Mark: And it’s much more interesting. Wouldn’t you be like…once you figure, like, once marketers get into excel and understand how numbers flow and by getting a thousand followers verses getting ten of the right followers, it’s game changing.

Eric: Much more powerful right?

Mark: Yup.

Eric: What’s your take on all of this? What’s your take on growth hacking?

Mark: I mean, I like it because I think it’s about being…it applies a constant iteration and curiosity and measurement by what’s working and what’s not. I don’t know if it’s the best term or the right term or not, I understand there’s some debate over, “Is growth hacking a good thing or a bad thing” but for me what that means for me is it’s constant curiosity.

Well, number one, it’s understanding what the key metrics are in a business, and that every business needs to understand what their core metrics are and the difference between a driving metric and a resultant metric. So, you may want to move one lever to move your revenue, but there’s another lever you do to…there’s multiple ways to move your revenue, you can increase customer count, you can increase customer value, you can increase the number of sales people you have, those are all different levers that drive to one number which is the result metric of revenue. I think that growth hacking, as it were, is you have to understand what lever and what metric you want to move and then you move it. As long as you are focused on the right thing it’ll move your business. And I think there should be a ruthless experimentation and a ruthless prioritization of ways to move those levers.

Eric: I think you broke it down perfectly. It ultimately all comes down to mindset and it comes down to like a focus, because a lot of marketers like to try all the new shiny things, but it ultimately comes down to one thing, which is growth. I think it’s a great thing. I think there’s a lot of debate over it and some people are like, “Are growth hackers really hackers? Are they technical?” I’m not technical, I don’t know if you are, but…

Mark: No.

Eric: So, cool. It’s good to hear from a guy who’s been doing it for a while. I guess breaking it down, three more questions here. What are your favorite marketing blogs?

Mark: What are my favorite marketing blogs? I suffer from not enough time to really spend time…I don’t know if I have a great answer for that. I think Seth Godin is a genius…I think that…I don’t know. I’m sorry, I don’t have a great answer for that. What should I be reading? What are the three blogs I should be reading?

Eric: I think Seth Godin is great. I think if I ever want to read marketing stuff…[laugh] I like how you turned it on me…I’ll read like Redit startups, I’ll read growthhackers.com, and inbound.org. They generally have a lot of great stuff there. I take my content from there and I also have my little twitter list as well.

Mark: Yeah, my first stop is Twitter every morning. You ask anyone what blogs they read verses “I just see stuff in my stream”. Yup, that’s interesting. That’s good, I wrote those down.

Eric: That’s actually interesting that we’re going in that direction. It’s not so much, “What’s my favorite blog?” It’s, “We both read stream”. Cool. In terms of productivity hack what’s one productivity hack that you recommend?

Mark: Hmm. Move this prioritization: understanding that you can’t get twenty things done in a day, but you can get three and knowing what those three are right? So like, keep a ‘to do list’. I’m in Evernote all the time. I know what my top priority is for the day and it changes and if I can…so my productivity hack is ‘move this prioritization’, you always have a list of things you want to get done, but start from the top.

Eric: So, what percentage, and that’s something I try to do, but sometimes I just completely fail, so what percentage of the time are you getting all three of those rocks done?

Mark: Fifty percent of the time. I’ll just say that. Because then there’re surprises that become more important at the time. As a marketer, this goes back to your first question, as a marketer the expectation should be; you can control everything, except for the stuff you can’t control, but like, any marketer who is not on a branded short domain, whose not customizing the back half of that link, and then running a promoted tweet with an un-customized un-parented link, says to me, we haven’t been able to reach them and tell them the story about what they can control. So, they can control everything. But like as a CEO and being responsible for so much more of the business, for all the business, there’s just stuff you can’t control. Like, we have fifty-five people and everyday there’s something interesting happening in there. Every day we have another partnership request or a corporate development opportunity, or an investor doing AB and C and that’s why I try to keep half of my day open every day.

Eric: Got it. Cool. I apologize, another question just popped into my head. So, as a CEO your job’s recruiting, right? So, are you trying to continually hire people smarter than you and if so, how do you, what’s one thing you do to make sure…what’s one thing that you do to gage whether this person is smarter than you or not?

Mark: Well, I hope that I’m smart too, but they’re smarter. The one thing is, did they…when I’m sitting in the room talking to them does it feel like my job’s getting harder? It’s going to be harder because I have to keep up with them. And so, that’s a common thread I’ve seen in the people that I’ve hired that are better than me, is that I’m sitting there thinking, “Oh shit. I’m going to need to really up my game to make this person productive.” And that’s thrilling for me. I’ve done it both ways. I’ve hired people that I’ve told what to do and that gets you only so far. But now, for example, our CTO Rob Platzer, like, Oh My God, does he drive the business and do I need to, like, keep up and prepare myself for when I meet up with him because I want to make sure that I’m supporting him with what he needs, for example.

Eric: Got it. Okay. Highlight that, I’m going to use that in the future. Final question here. So, what’s one book entrepreneurs need to read?

Mark: My favorite. I think it’s called “The Carrot Seed”, it’s for or about little kids, ordinary boys. It’s the book that says, ‘The little boy planted a carrot seed and everyday he watered it and everyday he picked the weeds around it. And his big brother said it won’t come up and his parents said it won’t come up, but every day he went back and watered that seed and pulled the weeds. And his big brother came and said it won’t grow up and his parents said it won’t come up. And then one day it came up, just like the little boy knew it would.’ Like that’s the entire book. But there’s the belief that what you’re doing matters. There’s the belief that what you’re doing is going to work. Don’t start a company because you think it’s a good idea. Start a company because you have no other choice but to start that company. So, I would read, I believe its “The Carrot Seed”.

Eric: “The Carrot Seed.”

Mark: Yeah, it’s literally a toddler book, but that message, “I believe” is really important.

Eric: That’s powerful. That actually makes things a lot simpler too. Great. So Mark, thanks so much for joining us. Thanks so much for the insight on Bit.ly. It certainly makes me want to check it out more as a marketer. Great show. Hope to have you again on the show sometime soon and we’ll talk to you later.

Mark: And hopefully we can do it in person in Santa Monica.

Eric: Yeah. Absolutely

Mark: Alright. Take care Eric. Thanks so much. Bye.

 

 

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  • http://ryangum.com/ Ryan Gum @ Postify

    Wow, I never thought about the bigger picture of the data Bitly collects. Amazing.
    I can see Snip.ly potentially creating similar value for their users if they do it right.