How Respona Reached $2.5M ARR with 400% Growth Doing Done-For-You Link Building (Interview with CEO Farzad Rashidi)

Introduction to Respona and AI Search Visibility

Nathan Latka

0:00Hey folks, my guest today is Farzad Rashidi. He's building Respana, which is a done-for-you outreach and link building platform that gets brand cited in AI answers across Chat GPT, Perplexity, and Google AI overviews. Farzad, you ready to take us to the top?

Farzad Rashidi

0:15Let's do it.

Nathan Latka

0:16This is a very debated thing right now. I just had the CEO of Air Slate on my show who was really good at SEO. He used SEO to scale to 200 million bucks of revenue. And I said, Is it possible to sort of gamify ranking on the LMs? And his answer was no. I'm gonna guess your answer is yes. Why is there such a big debate about this?

How AI Models Use Real-Time Search and Brand Mentions

Farzad Rashidi

0:35Well, think probably is the wording. So gamify is probably the wrong way to put it. what we essentially do is PR, done purposefully for sort of impacting your visibility in AI answers. So essentially the way these search engine these AI models work, much like any other search engine, is that when you ask it a question, hey, what are the best podcasts for entrepreneur? Hey, what I have a bootstrap business, I to raise funding. What's the What's the best place to say you know, raise nine diluted funding is that when you when you run these questions, what it does is that the AI model's training data is outdated because you know they stopped training six, seven months ago. And what the what these models do is that they essentially go and run a a Google search and they look through new and fresh, up to date articles. And the more frequently your brand's mentioned, like founder path is mentioned on these articles, the more likely it is you show up in AI answers. And this is not something that is my opinion, this is something that's scientifically proven. And you can you know, it doesn't take a genius to put two two together. Obviously the more brand mentions you have on reputable publications, the more likely it is you show up in these answers.

LLM Lag and RAG: How AI Answers Stay Current

Nathan Latka

1:46So what is the feedback loop? There's people that are saying, Nathan, I'm launching landing pages. We're getting more PR, but the problem is the LM's lag because the last training set was six months old. So when someone types in today, you know, top email marketing tools, we're not gonna show up yet because we have to it's a six month lag. I hate this and they hate that. Is that accurate today or the LM's changing? Are they doing real they're not doing real time search every time someone chats with them?

Farzad Rashidi

2:08They do actually. So

Nathan Latka

2:10Okay.

2:10there's a couple of ways to there are two sort of ways to look at this. One is there are a lot of companies that were trying to basically get so traditional SEO, the way it works is that you build content, you build landing pages on your website, you build some links to it and try to get it up in the search rankings. with the hopes that when someone searches for your keywords, they will land on your landing page and and that's how you convert customers. AI search is a little bit different. principles are the same. So when you ask a model a question, hey, what are the best email marketing tools? It does actually go and run and run a real-time search because their training data is outdated. So the way they do basically keep their information up to date is through RAG. And so they actually go and run a search. And what what would happen is that it actually not only relies on the content on your website, he actually goes and reads dozens of different sources. And these are from other reputable websites and publications that carry a lot of topical authority in the email marketing niche, for example. And it it basically the more frequently you're mentioned on there, then the more likely it is for the model to recommend you. again, mind you, the model is basically doing what a human used to do. You know, when you want to buy an email marketing tool for your startup, you just go and run a bunch of searches, read a bunch of reviews. the LLMs is just doing that for you in a matter of a few seconds. so the the sort of principles still remain the same. So you want to make sure you get your product featured in places that these L L crawlers are are reading articles on.

3:37We're all talking about like artificial general intelligence. If we assign an IP or a IQ to chat GPT today and say maybe it's only an eighty or ninety, right? So it's based like a human. But soon, I mean, it's gonna be three, four hundred. It's gonna be so smart. Isn't it gonna able to tell that I hired someone like Responder to go do this for me and it's gonna ding me?

Farzad Rashidi

3:55Yeah, so what we do at Responda, it's not like we own a bunch of websites and you know, we publish junk content. what we do is and what you pay us to do is to contact reputable publications in your space and earn you a placement there. So there's a big distinction. It's that at the end of the day, these publications have editorial autonomy. They can pick and choose the products they want to feature on their own website. And so the way we're able to guarantee placements is because we've done this at a very large scale and and and we have relationships with these publications. And that's what really our motive is, is these relationships we've built with these publishers over the long term.

Nathan Latka

4:31Are you paying them though? Like I mean, why do they care about what you want what link you want placed on their site?

Farzad Rashidi

4:36Yeah, so there's a variety of ways we incentivize publishers. Some of them are pay to play. Some some of them they don't necessarily care about the cash. Like for example, I come to you and say, Hey Nathan, can you feature me respond on your website for a few hundred dollars? It's not attractive to you. But if I tell you, Hey Nathan, I'm actually writing a guide on best for example, places to raise non diluted funding on for example Fortune magazine. and you know, in exchange, would you give me a mention on your website to respond? That's you're much more likely to say yes. So Yeah, and we used a variety of mix.

Nathan Latka

5:05So just to be clear, you're trading, you have your own inventory and you're able to trade in that way.

Farzad Rashidi

5:11And that's and again one other example. So what what we care about is getting those quality publishers to say yes. And publishers care about different things. so that incentive is really reliant on what the publisher cares about. Some of them want money, some of them want you know, trades and and other placements, some of them say no, and that's fine. And and so that's that's part of the job is that we actually do outreach for each one of the orders

Revenue, Team Size, and Profitability

Nathan Latka

5:36Yep, yep. Interesting. Okay. I don't want to bury your lead because you have a really interesting founding story here in terms of how this company came to be an independent thing. are you comfortable sharing what you're at today in terms of revenue before we get your backstory?

Farzad Rashidi

5:47Yeah, we're right around two and a half ish ARR.

Nathan Latka

5:50Okay. And how I mean, how does that feel? Do you have a thousand people on the team where it's like two of you and two million of revenue?

Farzad Rashidi

5:56Well, we I I think our team size about fifteen, sixteen people full time and then we have some contractors. We're bootstrapped and profitable so we don't have the luxury of hiring

Nathan Latka

6:06We love that you sort of say that as your voice gets quiet. But I this is the thing you should be shouting from the rooftops. You have total optionality. How

6:10Ha ha ha.

6:12how are we talking like ten percent profits, you know, thirty percent net income?

EBITDA Margins and Channel Diversification

Farzad Rashidi

6:16Yeah, I think abid a margin, we're trying to keep it in the twenties. it's a healthy margin. And you know, obviously we we're comfortable where it's at. We are dabbling into ads now because all of our customers find us through SEO and AI answers. So we eat our own dog food. But now we're at a stage now it's it makes sense to diversify some channels a little bit. So maybe the margins might go down a little bit in the next few months.

Nathan Latka

6:38Give us some some more of the backstory here. This isn't a traditional, hey, you had an idea, you started coding it. How did you get into this world?

Founding Story: From Visme to Respona

Farzad Rashidi

6:45Yeah, so I actually I joined Visme as the first marketing hire. That's another it was a competitor to Canva. They started around the same time. and Canva obviously went and raised a gazillion amount of funding and and they became Canva. And Visme took a bootstrap route. So Paymon, my business partner, he actually grew it and bootstrapped to about eight figures in ARR. And when I joined the company I built their marketing engine and they were bootstrapped, so they didn't have you know, crazy ad budget or, you know, and the product was priced at like twenty bucks a month. So it didn't make sense make sense to do out pound. So we relied a ton on SEO. And one of the key factors in SEO that we found actually moves the needle is by getting more of these external citations, getting these brand mentions, MAC links from high authority publications. And that was really the real bottleneck. And so we built some internal tools to sort sort of help automate it. And that's how Reswana was born. It was kind of an internal tool that we incubated out of it as me.

Nathan Latka

7:40So what year did you fin officially spin it out? Was that twenty nineteen? Okay.

Farzad Rashidi

7:43Twenty nineteen, yes.

Nathan Latka

7:45Did they make you pay for it or what was the economic arrangement like?

7:49with Visme.

Visme Equity Stake and Early Funding Arrangement

Farzad Rashidi

7:50Yeah.

7:50So Visme actually initially just funded the company. So in a in a way that we we you know we utilize Visme resources to build the, you know, we hired engineers and we built out the product. And Visme today is actually still a customer. So they pay us. but they did fund us at the beginning. And basically now what we did over the course of the past eighteen months is that we actually pivoted to done for you model and and happy to tell you more about that, which has been really interesting because we when we released the product, you know, we just like anybody else, we had a ton of excitement and we put it out and got a few customers and hit a plateau for a number of years and then we finally unlocked our product market fed over the past year and a

Nathan Latka

8:33Farza, how much equity of the business does Visme own today? You say you they funded you in the early days.

Farzad Rashidi

8:39They own about thirty percent now.

Nathan Latka

8:41Okay, so you sort of negotiated, hey, like did they actually give you cash on day one? Or they sort of said, Look, we've already put a bunch of cash into this. As you spin it out, let us keep thirty percent.

Farzad Rashidi

8:50Yep, that was more of the latter.

Free Tools, Backlink Checker, and AI Search Traffic

Nathan Latka

8:52I see. Okay. All right. So what have you done product wise between twenty nineteen and twenty twenty six? My research tells me most of your inbound is coming from a really smart free tool you guys built called Backlink Checker. Is that accurate?

Farzad Rashidi

9:05Not quite. Well, yes, actually we have a we have a landing page on there that's driving some traffic, which is great. thirty-seven. Yeah, yeah, yeah.

Nathan Latka

9:12It's telling me that thirty seven percent of your traffic in terms of reps is coming from that.

Farzad Rashidi

9:16Yeah, absolutely. Yeah, that that's a free tool. We're hopefully looking to build more of these. But essentially what we did at Respawn I know and and this is something that we we're continuing to build on, is it's a bunch of landing pages, content pieces, and you know, free tools like that obviously bring in. Quite a few. 60% of our customers, though, however, find us through AI search now. So

Nathan Latka

9:40Mm-hmm. Like what? What do they search?

Farzad Rashidi

9:43on Chat GPT, for example, when

9:45Yeah but

9:45you ask what are the best tools for link building, and you know, and Google AI overviews, et cetera. So it's about 60% of our customers now find us there. So yeah, there you go. Respond is right on there.

9:58Yeah.

9:59go ahead.

Nathan Latka

10:00How do they you is the main difference between A dress and SEM Rush and you is that you're you're you got you're done for you. You're more agency model versus no touch.

Farzad Rashidi

10:08Yeah, so HROS SCM restore analytics tools. They tell you like here's how much traffic you get, yada, yada, yada. A responder helps you actually increase those. So we get you these external brand mentions and citations on these external websites.

Nathan Latka

10:20Do you know all the searches just like we would use Search Console to see what we rank for? Do you know all the searches, the chat searches that you rank for?

Farzad Rashidi

10:27So unfortunately ChatGPT doesn't have a search console yet. So it's just pretty brand new. what we're doing is basically kind of replicating what's already working traditional search and kind of optimizing around that. because still the same humans now, you know, they used to use Google traditional search and now they're using these AI models like Claude, you know, and even on Google AI overviews, you know, you search anything that AI snippet at the top is really what what most people pay attention to.

Nathan Latka

10:54I mean, you're eating your own dog food, you're getting according to ATREFs, fifty thousand organic clicks a month. You have twelve thousand of your own backlinks, referring domains, et cetera. what what can folks like if if they don't have enough money to pay you, right, to to hire you yet, what are some lightweight things they can do to replicate some of your growth in terms of backlinks and organic traffic?

Farzad Rashidi

11:15Yeah, I mean we certainly don't do any magic. people can do this in-house. and what we do is producing content, creating landing pages to build the right foundation for the website. Nowadays very easy, especially with AI, to do that. So that's step one. Step two is earn these external placements and mentions because it doesn't mean anything if I say, respon is the best. But when Nathan says response, cool, you should check it out. That means something. So same thing applies also to SEO. now some of the lightweight things you can do to earn them. One of them is what I'm doing right now. Go on podcasts, tell your story. And you know, you're gonna spit up a page on NathanLatco.com and and and you're gonna get a backlink from there. So there you go. So that's one one strategy there for you, which doesn't require you to you know pay anyone anybody anything. and there's lots of other things you could do. again, having these I would say content swaps would be helpful from the get-go, like you writing content pieces, contribute to other sources and then offer to mention people on them. and you do the same, essentially asking them to get you mentions. obviously writing some I would say linkable assets like any statistics, any original research you've done, those are great ways to get some organic links, kind of references for your content pieces. There's lots of different ways you can earn these links or you know, pay a two like respondent and we'll do it for you. But you know, that that's different ways to skin a cat.

Nathan Latka

12:39Yeah, we're we're getting we're getting more and more. I don't know why, but like if I I recently interviewed the CEO of this company called like Flip CX. This is just an example, but we're getting more and more CEOs coming to saying, Nathan, I came on your show because specifically I backlinks. And I What do you mean? And they say, Well, look, your the video ranks number one. You you you take over a bunch of the a bunch of the key like keywords in certain places, like up up here, like it's a lot of valuable real estate. They they

13:01Mm-hmm.

13:01want the interview to be sort of attached to it. so we're seeing that more and more, but I'm just not aware that. The LLMs are actually using things like, you know, are podcast interviews to rank people higher. I hear that peop you know, they're using Reddit and things like that more. Is your research showing you something different?

Farzad Rashidi

13:17So Reddit is one of those sources that gets cited often. it's actually the most cited source, but what percentage of citations do you think comes from Reddit? Less than five percent. So

Nathan Latka

13:26No idea. Okay.

Pricing Model: Pay Per Article Placed

Farzad Rashidi

13:29ninety five percent are still editorials, content pieces that are published on other people's websites. It's just a wide range of them. It's not concentrated on a single domain. That's why, you know, people always talk about Reddit. but if you actually focus on getting editorial placements that are hard to get and you know and it and and it's expensive, these are real competitive advantages and it's been a ranking factor for twenty plus years.

Nathan Latka

13:51Interesting. Okay. So so help me understand your pricing model. What's the average customer paying you today?

Farzad Rashidi

13:57Average customer, so our pricing is paper article placed. So we guarantee results, and that's what's really unlocked our revenue growth over the past 12 months. It ranges from 100 bucks on our lowest tier to 500 bucks on our highest tier. And by tier, I mean the power of the publisher, how much how much traffic and authority they have. and we also have a really interesting discount model. So at the top, if you see we have subscribe and save plans. And that, you know, basically start giving discounts on placements that scale all the way up to 60% discounts. And this is very attractive also for SEO agencies, people that offer this as a service to their clients, or just enterprises that spend a lot because we negotiate bulk rates with these publishers, we can drive down our costs and we pass along the savings on to our clients instead of keeping more margin. And that's what's been really attracting a a lot of higher volume of customers for us.

Nathan Latka

14:49Mm-hmm. So I could sign up with you for three grand a month and I'd pay 216 per actually let's do 360 per placement. But that's for every website you get published on where the domain authority is greater than 50. So for example, if a customer came to you and said, I really want to be on, you know, Nathan's site or I get Git Latka, you would go, Okay, well, let's just look at Git Latka. The domain rating is a 72. So if you had a relationship with me and you got your customer on Git Latka, they would effectively pay you since it's a 72 DR. they would effectively pay you the three hundred and sixty K per pl or sorry, four hundred and fifty per placement tier.

Farzad Rashidi

15:23Yeah, exactly. And that includes not only the publisher fee but also doing the outreach content writing and we help you create that piece of content. So that's all inclusive pricing is fully done for you. So you don't touch a thing, we just take care of the whole thing start to finish.

Nathan Latka

15:36Yeah, really interesting. Really interesting. And why do you say that this pricing change unlocked revenue for you?

Farzad Rashidi

15:41So when we started Responda, we were a do-it-yourself email average software. So you had to reach out to publishers, build a relationship with them directly, negotiate with them, write the content, do all the work yourself. And you would have to literally effectively hire someone to do this type of work for you. And what we had was, you know, we had a consistent flow of new leads and customers coming through, but churn caught up with our new customers quickly. So we hit a plateau at a few hundred K ARR for years. And we were just convincing ourselves that, if you just build more features. it would get more sticky and people stick around. it wasn't until last year, about a year and a half ago, we actually had a CEO of a large marketing agency reach out to us and we had a subscription plan that was like 800 bucks a month. And he was like nickel and diamond. He was like, what if we pay $500 a month? I was like, this is interesting. This this company had like two all a few hundred employees, like this their CEO spending time negotiating with me over 300. And then he said something interesting. He was like, okay, well, because I sent him case studies. I was like, look, like, you know, agencies are building a lot of links and placements for the clients through us. And he was like, if that's true, then what if we pay you like, you know, X amount per backlink we build? And you know, if those are correct numbers, then we will pay you many thousands a month. And it was like, well, that's interesting, but we're at the mercy of your team to actually use the software effectively. Right. So I was like, okay, what if we just do it for you? And I threw a Hail Mary out there. You know, it's sin in the software world to offer services. And and and he was like, sounds great. Let's start at seven or eight grand a month of spend and that same customer is still with us, I think they're last month and they spent sixty five grand with us a month.

The Done-For-You Pivot and the $65K Customer

Nathan Latka

17:20So can that's my question. It's like, do you do this one shot or do you have to keep doing it? Like you're growing a plant and you have to keep pruning it. I mean, I would guess, like again, I'm not knowledgeable in this space, but I would guess you do it once, you get ten thousand backlinks, you're like pretty much set for five years.

Farzad Rashidi

17:34So no, actually. So what I would recommend folks to do is to pick a monthly budget and stick to it long term. it's something that you have to do consistently. I'm biased. All right. But I'm

Nathan Latka

17:41But of course you would say that because you want to keep your churn low.

Farzad Rashidi

17:45just saying if you have 10 grand, don't spend it all in one month. Like spend two grand, you know, over the course of l in in the long term. and and the reason why you say that is you want to keep an organic, consistent flow of these mentions coming through because this AI answers, they don't cite articles that were published, you know, a year ago. articles need to have been published over the course of the past month or two for them to essentially get in the citation pool. And so it's a much better, I would say, effective strategy to to do it consistently at a lower budget each month versus kind of doing a lump sub payment at the beginning.

Nathan Latka

18:19Have you worked with any of your customers, maybe say the CEO, and gotten them enough placements on premium DR sixty plus sites where you could then submit them to Wikipedia so they can get their own Wikipedia page and the Wikipedia page will actually approve it because there's enough cited sources on these non-biased

18:32Edition.

18:33sites.

Why Consistent Monthly Spend Beats Lump Sum

Farzad Rashidi

18:34That's an interesting idea. No, we haven't done that yet, but we should probably. and so one of the things though is that a lot of the placements we get aren't from just traditional news press type sites. They're actually from sites that carry a lot of topical authority. Usually there are other companies that have a blog and write content. because a news site inherently writes about anything and everything, so they don't carry a ton of topical authority. You know, they might get a lot of traffic, they might have a high DR, but those aren't necessarily the type of links that we see the highest correlation with rays in traffic and also AI citations. the type of links and mentions that move the needle are from topical experts. For example, if Nathan Lacka is like rooting for a finance fintech product, you know, because you're in fintech space, or another SaaS tool, it means a lot more versus me getting a feature on For example, Wall Street I I guess that's not a good idea, good example. Or a local newspaper, for example, because they write a

Nathan Latka

19:32A generalist site.

Farzad Rashidi

19:33exact

Nathan Latka

19:34Yep. Yep. Very interesting. Well, how do you think about the business today? I mean, you've bootstrapped, I mean, Visme owns, you thirty percent. I assume you and your your founders, your team own the rest of it. You're two million of revenue. If someone came today and offered you, I know, four million all cash, do you sell the business?

Topical Authority vs. High-DR Generalist Sites

Farzad Rashidi

19:49No. And the reason why is that we're very bullish on AI search. So AI search is basically bringing back off H SEO. So AI visibility is not directly correct. So it's no longer enough to get your own website to have enough power to get cited. You need now need to consistently get other websites to mention you and recommend you in order for you to stay and defend your position in AI answers. And so for that, we see more and more companies that would never looked at link building in the past not be interested in link building. We have enterprise companies that are now coming to us and and getting help from us to get placements. And so we see this just at the beginning. So like past twelve months, we five X'd our revenue. And we don't see that slowing down anytime soon. Maybe in a few years, obviously when the AI hype dies, you know, maybe that would impact. But but we see it at it being at the very, very early stages of of our work, so not something we're looking to exit yet.

Why Farzad Would Not Sell at a 4x Revenue Multiple

Nathan Latka

20:49Congrats on the growth. As we wrap up here, there's a lot of people that debate about running campaigns on App Sumo in terms of the quality of customers you get. You've done it twice. What do you recommend?

AppSumo Campaigns: Lessons and Recommendations

Farzad Rashidi

21:00Yeah, so we actually, if we recall, so that first when we started, we had a do-it-yourself email average tool. And so when we pivoted to done for you, it's an entirely new process, an entirely new product, but we still had a pretty solid product on sort of that do yourself side. So we're like, okay, how do we use this as sort of lead gen for our done for you program? And so what we did was to launch a couple of campaigns on App Sumo, so we're basically giving that email average product away for. free. I mean you pay a couple hundred bucks and get, you know, lifetime access to it. And the goal for that is that for those customers, portion of them would be like, you know what, I could do it myself. I don't want to hire people ends up being, you know, more cost effective if I just let you guys do it for me. and then we actually had conversions coming from it. I wouldn't do App Sumo campaign as as a way to monetize your software because those are L T D customers are not looking to you know, pay a subscription to a software. So unless you have a service you can upsell them to, then that might stick, but not something I'll recommend if you're just a pure SAS play.

Nathan Latka

22:06Yep. Very cool. Well, congrats again on the growth. If far as a lot of people want to follow your story, where can they find you online?

Closing and How to Follow Farzad Online

Farzad Rashidi

22:12LinkedIn, it's my only social media. My name is Farzod Rashidi. Not a ton of us out there, so pretty easy to spot.

Nathan Latka

22:17Guys, there you have it. Joined his his friend's company, helped him scale it to eight figures of revenue pre-2019. And then said, you know what, let me spin out our link building tool. They spun it out of Vizme in twenty nineteen. Visme kept 30% and was sort of, we'll call it the sugar daddy early on for Respawn. But today he's building it himself. They were stuck at a couple hundred thousand bucks of AR for many years, really through twenty twenty four. And then they changed their pricing model to done for you. Imagine that, ad services, and his revenue is five X. over the past caught, you know, eighteen ish months. They're now at two million bucks of AR, fifteen FTEs, and trying to target around twenty percent EBITDA margins. So default alive, we love that. Farzod, thanks for taking us to the top.

Farzad Rashidi

22:56Thank you so much for having me.

Nathan Latka

22:57All right, guys, cut. Far aside, what'd you man? You have fun?

Farzad Rashidi

23:01It was amazing. Loved love the efficiency.

Nathan Latka

23:04Yeah. Hey, quick I have to jump to the call, but just a quick thing. I mean, i if you brought us software CEOs that were qualified. So like I can't pre-revenue, but if they have a more than a million of revenue, we'd put them on the show and give them backlinks on Git Latka. And you know, we're a 72 DR site. So like

23:21Next.

23:21just keep that in mind. I would I'd be willing to pay you a hundred bucks per because I pay a booking agent to help me with this stuff. So why would I not pay you? Right. So I'll pay you a hundred

23:29huh.

23:29bucks if that's something that you want to look at. And then the flip side is like, We've been trying I mean, we should hire someone like you, frankly, to do a bunch of our, you know, link building authority for my personal name, for founder path and for the podcast.

Farzad Rashidi

23:43Absolutely. I would love to have a separate conversation there because I know you have to run. first of all, referring founders to you. I know a handful, I'm happy to send them over to you. No no need to pay for that. I'm I'm happy to help them out and help you out. and see if people that'd be interested. Some of them are quite reserved and private about their revenue numbers. Yeah, exactly

24:01Those one those one work, yeah.

24:03exactly. So, you know, I have to run it by them. I love the transparency you have on the show, but that's what makes the podcast attractive. I'm just saying like

24:09A hundred percent.

24:10not all founders are comfortable with that, which is fair. so definitely I gotta I'm reading for

Nathan Latka

24:23Okay. All right. Good to meet you, man. Talk soon. All right. See ya. Bye.