Posted by RobOusbey

This is a graph of organic traffic for a theoretical site – they might be in an industry such as print advertising, construction equipment or VHS rental. The decline in traffic is pronounced and serious.

A critical distinction when looking at a graph like this is whether the site’s performance is increasingly worse than the competitors, or whether the whole industry is in decline. In this post I want to recommend some metrics that can be tracked to benchmark your site against competitors (independent of market behaviour) and to check the health of the industry. I’ll then make suggestions for finding opportunities to slow or reverse the trend of dropping traffic.

For the benefit of the time-poor, the post ends with a three point checklist / summary.

Competitors and Benchmarking

There are a couple of different metrics you can use track, which will demonstrate the more direct outputs of your SEO work, and expose your performance amongst competitors.

This chart tracks the Site Authority of the target domain (and some competitors) through time.

To date, trying to chart Linkscape metrics has been a bit misleading: the rapid increase in the reach of Linkscape and modifications of the tool’s algorithms have meant that month-by-month reporting of a site’s Authority wasn’t always a fair comparison. However, Nick tells me that the team are currently putting effort into tackling the challenge of tracking this data. Though you’ll have more confidence in drawing a trend chart such as this one soon, I’d still recommend collecting numbers right now to get a snapshot of where your site is amongst the competition.

Obviously, this assessment of site strength is query independent; differences in site architecture, on-page term targeting and the anchor text of external links will have a significant effect on each site’s performance and number of keywords.

In many ways, the next graph address this. The line for the target site is an ‘average ranking position’ – I’d recommend creating this by taking around twenty non-branded, representative keyphrases (eg: ten which you’re specifically targeting and ten which send a significant amount of traffic) and finding the mean of the site’s ranking for each phrase.

The competitor lines should be calculated by finding the mean ranking position of that site, for each of these keywords where the site ranks in the top 20. (We do this so that the mean isn’t artificially dragged down by keyphrases which the site isn’t trying to compete for, and where it ranks very poorly.)

Even a single month’s data points on these two graphs will provide a snapshot of your site’s position amongst the industry’s other players. Tracking the data each month will demonstrate how your standing has changed, and can directly show the impact of your SEO work – both on-site and off-site.

Industry Assessment

If you have been collecting ranking data in the past, then it can be useful to identify a term for which you’ve had a relatively static ranking over the last year or so. If your traffic from this term has declined over the same period then this provides a useful example of how market behaviour outside of your control is having an effect on the business.

If you don’t have historic ranking data, but suspect that your industry is in decline, you should compare search volume trends to organic traffic sent by some specific terms. In the example below, the site sees a decline in traffic for the single keyphrase ‘football tickets‘ but comparing this to the search volume for the term shows that the site’s performance has actually improved – they are increasing their share of that traffic.

If the industry really is declining and search volumes for all the typically valuable phrases are unlikely to return, then there can be a serious consideration about even continuing to operate in the market. If your core business was VHS rental, consider offering Blu-Ray; if you rank well for house and holiday insurance but are suffering from the decline in these markets then consider adding pet insurance  – a steady / growing market. (Check out this Google Insights data for UK insurance markets.)

Of course, these are extreme examples – and if you’re in these particular industries then you shouldn’t need a blog post to make these suggestions – but they remind us that there are some markets where a time comes to look for business from elsewhere.

Actions

As we did in the graph above, you must begin by looking at the organic traffic trend for keyphrases individually. A lot of information is lost when data is aggregated (such as in total organic traffic.) Go back and look at your highest volume keyphrases from a year or two ago, and compare these to your current highest volume keyphrases, by charting the monthly volume of traffic they sent over that period. It may quickly become clear that whilst your keyword portfolio has been dragged down by some dogs, there are some stars (or problem children) that are contributing a great deal to the overall traffic.

If you last did keyword research 12 or 18 months ago, user behaviour may have changed significantly – even for people looking for exactly the same product. Whilst the metrics mentioned above may bring you to the gloomy conclusion that search volume in your industry is substantially down, it’s possible to overlook the fact that there’s simply been a change in searcher behaviour.

Examples of such changes that have happened in different geographic regions:

• searchers are using more direct queries (‘cinema‘ & ‘film tickets‘ are steady or down, ‘film times‘ is way up)
• searchers are moving from long tail to head terms (‘internet marketing‘ & ‘website promotion‘ are declining but ‘SEO‘ and ‘SEM‘ are up)
• searchers are moving from head to long tail terms (‘currency exchange‘ is down but specific terms such as ‘dollars to pounds‘ are up)

The message here: don’t miss out on opportunities to compete on the emerging keyword groups.

I promised you a checklist.

Please take away these three points:

1. If your organic traffic is down, either for particular keywords or as a whole, be clear whether this is because your site is under-performing, or because the search volume for a keyword / in an industry is descending.
2. Benchmark yourself against competitors by regularly recording the Authority and/or rankings position for relevant keyphrases of your site and theirs
3. Revisit your keyword research – a year is a long time on the internet, particularly given the current state of flux that so many industries are experiencing.

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Posted by great scott!

This week Rand discusses recent changes that seem to signal the coming of another big shift in how the engines determine results. With the incorporation of social networks into results, increased personalized search, and even Google Buzz, the social graph is clearly becoming a more and more important factor for the engines. What will these changes mean for online marketers and how can you take advantage of them? Watch this week’s Whiteboard Friday and find out…

And here, for your browsing pleasure, are some of the resources Rand mentioned in the video…

• Video intro to Google Buzz:

• Royal Pingdom says Twitter now processing more than one billion tweets per month.

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Posted by randfish

Prelude: I’ve long promised blog readers a detailed accounting of my experiences raising capital over the course of last summer and into the fall. My apologies for the long delay, and to those seeking more SEO-focused content. This entry is lengthy, detailed and designed to share as much as possible, so hopefully you’ve got a good 20 minutes to read it We’ll be back to SEO tips & tricks tomorrow.

Sections in this post:

• Introduction & Venture Capital Primer
• Building the Pitch Deck
• The Pitch Itself
• Getting Introduced to Venture Capitalists
• The Meeting Process
• What VCs Liked and Didn’t
• The Final Outcome & the Future

Introduction to our Process & Venture Capital

In this post, my goal is to walk you through the process we used, the feedback we received and the final results and decisions. Fundraising is a demanding, lengthy, emotionally charged process and something that challenged me personally more so than any other single part of my life in the last 5 years. I hope that by sharing my experience I can help others who start down this road and give you an idea of what to expect. The more knowledge you have, the less fear can hold you up; that’s what this post is here to accomplish.

First, I’ll try to provide some context around why we went to raise money in the first place, how we constructed our "pitch deck," how we got introductions and meetings to a large number of VCs and the progress from initial meetings to partner meetings to final decisions.

SEOmoz started the VC process in June 2009, in possibly the worst climate for fundraising since 2001. You can see the stark contrast from our timing with the previous round in, arguably, the best environment since 2000.

Graph of Venture Capital Invested by Quarter (via NVCA)

Ventue capital is "expensive" money, not just in terms of the price paid in equity, but in the obligations and requirements that come with it. In our Series A, we took money more like a seed investment – Michelle & Kelly saw potential and wanted to see what could happen. Raising another round meant aiming to hit the "home run." For those who are unfamiliar, the startup world has built an entire lexicon around the "seriousness" and exit-size focus of a company that ranges from "lifestyle" businesses that don’t try to achieve multi-million dollar scale to "home runs" that exit for $1billion+.

Note that there’s plenty of criticism of this model from both the venture side and from entrepreneurs and operators. Lots of other blogs have talked about the imbalance in interests between founders and investors and current market conditions vs. expected VC portfolio returns. I won’t re-hash these, but as a broad overview, most venture funds have 100s of millions of dollars from their LPs (Limited Partners – folks like large endowment funds, pensions, government entities, extremely wealthy individuals, etc). In order to provide significant returns, they follow a model of investing in a few dozen startups, most of which will go bankrupt and, hopefully, 1-3 of which will provide most of the profits in billion dollar+ "exits" (an acquisition or IPO).

This somewhat odd scenario means that VCs are often investing in "long shots" to be huge, rather than low-risk bets for more reasonable exits (for example, an 80% chance of exiting for $150 million is not nearly as interesting as a 10% chance of exiting for $1 billion). As an entrepreneur, particularly a first-time startup guy who has $3,000 in his checking account, an orange scooter and a small apartment, the incentive is completely the reverse. Fred Wilson wrote a bit about this disparity in his post on Swinging for the Fences.

In order to be appealing to a venture investor, especially those with larger fund sizes ($300 million+), a company must be able to show a credible path to that $1 billion+ exit. Since the average VC-backed exit is actually something under $100 million, it’s a bit of a "wink, wink; nod, nod" game. Both parties recognize that a more likely outcome is something far lower, but the "sell" has to include the envision-able path to hundreds of millions in annual revenue that can yield those tremendous exits. Again, I’ll point to Fred, who wrote about the Venture Capital Math Problem (and a Part 2).

Building the Pitch

You can read a lot more about the catalysts for fundraising on my post – My Startup Experience: VC, Entrepreneurship, Self-Analysis & the Road Ahead – so I’m going to dive right into the process for creating a pitch deck.

We started with a lot of great advice and direction from entrepreneurs who’d been down this road before and also got terrific help from the partners at Ignition, for whom we delivered a "mock" pitch and collected feedback that helped push us in some smart directions. As a base, we used the model promoted by VentureHacks and sprinkled in bits liberally from Dave McClure’s excellent How to Pitch a VC deck and Guy Kawasaki’s – Perfecting Your Pitch (PDF).

The process itself involved sheets of paper affixed to a large wall, which we’d then swap around, tear up, mark up with pens and generally treat like a post-it-note fight. We started with blank paper that we’d draw on, then began creating real slides in Powerpoint. It was fun – exhilirating and stressful, yes, but also exciting. We were going to raise millions of dollars, put that money to work and build incredible product and an amazing revenue stream.

Before we did that, we had to get beaten up a bit first. I mentioned that we gave a test-run pitch of the deck to the board at Ignition Partners (our first-round investors). We also privately delivered the pitch to a handful of CEOs and angel investors, hoping to garner feedback and assistance (these weren’t serious attempts to raise money, as we weren’t seeking an angel-type deal). The great part is, we really did get beat up. I have pages and pages of notes from meetings where I showed the pitch to other entrepreneurs and got feedback ranging from "this is almost perfect, just tweak X" to "you need to start completely from scratch, and here’s the deck I used to raise $XY millions in my last round."

I’m going to come back to this again below, but the generosity of time, energy and prior work (even stuff that’s usually very private) from other startup CEOs and entrepreneurs was absolutely remarkable. I found none of the closed-door mentality or brash indifference I expected, especially in Silicon Valley. Founders and CEOs, who had multi-million dollar businesses to run would take hours out of their days to have lunch, walk through the deck, and introduce us to VCs they knew. I’ve rarely known so much goodwill from people who have so many demands on their time.

The Pitch Itself

Let’s get to the meat and potatoes, as I’m sure by now you’re hungry :-)

The "elevator pitch" sounded something like:

SEO is huge – every site on the web is doing it or wants to be. But the process is broken – it’s hard to learn, hard to measure, hard to know what’s working and far more art than science. We are going to build software that helps transform SEO into a mainstream marketing activity, the way analytics software (Urchin, Omniture, etc.) did for web visitor reporting or email software (iContact, ExactTarget) did for email marketing.

Unfortunately, I’m not going to share the exact deck we used, nor all the details from it. Transparent though I love to be, there’s a lot of information and data points that aren’t fit for public consumption. It’s less that I believe any of this data could be used to materially harm us and more that we’ve made promises to our investors and board to keep this stuff internal for now. I will say this – while I believed strongly in the deck when we first created it, that confidence was somewhat eroded by the end of the process. In late September, for example, I think I could have done a far better job crafting and delivering the pitch than when I gave my first one in July (only 60 days before).

Below, you’ll find a modified version of the original pitch deck (we later crafted many customized versions with slides particular VCs wanted to see). It doesn’t include things like a P&L statement or specific customer retention/churn/lifetime value metrics, but hopefully it will still be valuable and interesting.

Since I didn’t include revenue/profit numbers in this deck (and it’s hard to get a sense for how a potential investor might perceive this without it), I’ve included some non-specific growth charts below, illlustrating the top-line numbers in a profit-and-loss statement:

 

I’ve also left out some portions of our very large appendix. The appendix, in fact, was one of the most interesting parts of the deck. When we started the process, it was 5-6 slides with additional information about market size, importance, some detailed stats on membership, lifetime customer value calculations, etc. A month into the process, it was nearly 30 slides, attacking every question, problem or issue that had been raised in meetings where we didn’t have an immediate solid answer or data point. I really believe that the VC process is all backwards in this fashion. The pitching company should:

1. Have an introductory call to see if there’s interest
2. Attend a sit down meeting with a partner or two, some associates and a dilgent notetaker to get all the questions, concerns and issues on the table
3. Go back home, make a great deck that addresses the things the VCs care about
4. Come back and give the formal pitch

Instead, many pitch meetings at the beginning made us feel like amateurs and it was only at the end of the process that we felt more comfortable tackling any question thrown our way (mostly because we’d heard nearly all of them before). In my opinion, venture capital shouldn’t be about who has the most experience pitching, or who can deliver the best pitch, but about who has the most exciting, interesting company. In the current model, it feels like 80% sizzle (pitch) and 20% steak (company).

Then again, what do I know about the VC process? I got lucky in my mid-twenties, landed a bit of capital, and have never invested or even studied the venture model the way the professionals have. Perhaps ability to pitch and success of company are well correlated metrics or at least, indicative of company performance. I’ll leave that to those more knowledgable on the topic.

In any case, now that we had this story to tell (the pitch deck), we needed an audience.

Getting Introduced to Venture Capitalists

I initially presumed that our investors (Kelly & Michelle) would drive this process of introductions and networking, but in reality, this is apparently a suboptimal methodology. Michelle explained (and many others concurred) that entrepreneurs themselves provide the best introductions. Thus, it was my task to find other founders & CEOs who would provide positive connections to the investor community. Outside of Ignition, I knew virtually no one in that sphere, so this would be my first formidable challenge.

Thankfully, the entrepreneur community was incredibly kind – generous to a fault, actually. Busy CEOs of important startups took time away from their jobs to sit down for coffee with me, buy me lunch, take me to dinner, review the pitch deck we’d built, give advice and make introductions to a very impressive set of folks in the VC world. In exchange, I did the best I could to help them with SEO, and we hosted a number of great companies at our offices in Seattle for hour-long SEO reviews. It will be hard to thank everyone here, but I’ll do my best:

• Seth Besmertnik from Conductor
• Dion Lim & Gautam Godhwani from SimplyHired
• Jeremy Stoppleman from Yelp
• Dave Goldberg from SurveyMonkey
• Alex Schultz from Facebook
• Barnaby Dorfman from Foodista
• David Niu from BuddyTV
• Jonathan Sposato from Picnik
• Trevor Traina from Driverside
• T.A. McCann from Gist
• Merril Brown from Curious Office
• Nirav Tolia from Fanbase
• Mike Cassidy from Ruba
• Maria Thomas from Etsy
• Nathan Kaiser from nPost

I’m indebted to all of these great folks and I can only hope that the SEO help we provided to many of them has returned some of that.

However, this part of the process is also where we made our first big misstep. Explaining will take a bit of background.

SEOmoz’s business model is what’s generally called "self-service SaaS." Similar to most SaaS companies, we sell software in a subscription/licensing type of model and, as has become common in the last few years, do it "in the cloud" (meaning we don’t install software; everything’s run remotely over the web). However, we’re very different from traditional "SaaS" in that we have no sales team. There isn’t a single person at SEOmoz whose job title or description includes sales (though, technically, if Gillian and I had descriptions, "sales" might be part of that).

Our business model and margins might result in an acquisition price (sale of the company) of between 3-6X trailing revenue, depending on the market circumstances, growth rates, strategic importance, etc. This is massively favorable to consulting revenue, which typically garners 1-1.5X. Put another way:

• An SEO consulting business sale price (assuming $5 million in trailing revenue) = $5-7.5 million
• An SEO self-service SaaS business sale price (assuming $5 million in trailing revenue) = $15-30 million

It’s no surprise that investors are far more interested in these "scalable" business models that have higher exit multipliers. This is a big reason why you rarely ever see venture or angel capital flowing into consulting firms. The margins on a consulting business hover between 40-55%. Margins in software get closer to 80%+ and scale isn’t proportionally tied to cost (in most consulting businesses, the more you want to make, the more consultants you need to hire). 

In our situation, a VC in the B-round would be likely to get something between 15-20% ownership in the company (depending on valuation, amount in, etc). Let’s look at a chart that helps explain why we messed up from a strategic standpoint in the introductions process:

Doing the math, even at the high end of the revenue/exit numbers, the VC is making 15% x $450 million = $67.5 million. If you have a $300 million fund and invest in 20 companies, you need at least 6 and hopefully 7-8 of those to hit in that range. The odds say that 10 of those companies will go under, 8 will have much more modest outcomes and 1-2 will return the lion’s share. Thus, big fund VCs are going to be seeking portfolio investments that address multi-billion dollar markets and have a shot at that massive IPO/acquisition.

A smart entrepreneur would look at this ahead of time and specifically chase venture capital firms with small-moderate fund sizes. Unfortunately, we didn’t plan ahead intelligently on this, and thus talked to many folks with funds between $100-500million. At those levels, it’s the 1/20 or 1/50 billion dollar+ exits that bring all the returns for the VC. They’re not seeking a reasonable bet on a company that has an long-shot, outside chance at a $500 million exit. They want 20 or 30 companies with 1 in 20 or 1 in 30 chances to go all the way to that billion dollar acquisition or IPO.

Our introductions came streaming in very unstrategically. I met with lots of entreprenuers and people in the tech community, who put me in touch, usually via an email introduction, to a partner at a firm. We’d exchange a couple emails to set up a time to talk, chat for 15-45 minutes (sometimes longer) and then schedule an in-person meeting for the next time I was in their area. Those introductions didn’t come all at once – in the first 30 days of actively pursuing introductions, I had ~10 calls. Then, over the next 40 days, more and more introductions would roll in from people I’d connected with in the past couple months, and those would turn into calls and meetings.

I talked to entrepreneurs who were much more strategic and exacting about their introductions process (and plenty who followed a similar pattern to what I did). In hindsight, it wasn’t perfect, but I did get to meet a tremendous number of very impressive investors and get their feedback.

The Meeting Process

During our fundraising experience, we connected with a lot of VCs. I’ve taken a screenshot of the the firms we talked to below (from my Google spreadsheet file on the subject), though I won’t go into more detail about who from each firm we talked to or how far along we progressed with each of them. I think there’s an expectation of privacy most VCs have, and I want to respect that. BTW – I’m not listing every single firm we talked to, but this is a more-than-representative sample and hopefully fulfills our core value of transparency.

Initially, we were very excited and I’ll try to explain why. When starting out, our expectations (thanks to both advice from other entrepreneurs and via blog posts/articles the web) were that 10-20% of phone calls would lead to first meetings , a few of these might turn into partner meetings and we’d hopefully get a term sheet or two at the end. Instead, the funnel looked like this:

As you can see, we had phone calls with 40 firms, and had a surprisingly high conversion rate to first meetings, which had us initially enthusiastic. VCs are notoriously busy, and scheduling time with them is often a massive challenge. To have such a high percentage of firms interested in such a dour climate made us believe we could buck the trend. Unfortunately, it also meant lots of time we needed to invest in preparing for, and in most cases, flying out of Seattle for in-person meetings.

The entire process from the first call I had with a partner (on June 18th) to the time we stopped actively pursuing funding (September 30th) was 93 days. In that time I made 5 separate roundtrips to San Francisco, which adds up in hotel, airfare and car rentals. Raising money takes time, resources and a tremendous amount of energy, not just from the founder/CEO, but from the entire team. Adam & Matt were consistently pulled away from day-to-day and strategic work to create and refine the product demo. Sarah, Christine & our accountants labored to provide detailed financials. Jeff often had to postpone critical work items to make custom queries against our members database to pull an obscure metric about recitivism, churn or usage.

The meetings themselves are fascinating. I’ll be honest – the first few were completely intimidating and overwhelming. Like most times in life when you’re nervous, it wasn’t until I stopped worrying and (very nearly) stopped caring, that I got good at the process.

You arrive at a non-descript, but very well-adorned office building, almost all of them on Sand Hill Road in Menlo Park. An assistant, who is nearly always young, female, very attractive and somewhat cold (though there were a number of exceptions), greets you in the front room and will offer a beverage. I typically waited only 5-10 minutes, though a few times it was 20 minutes or more, after which I’d be escorted into a meeting room with a place to plug in my laptop to a projector or screen. VC offices provide free wifi (though I always brought my AT&T aircard just in case) and are designed to impress – expensive furnishings and artwork, placards showing the successful companies they’ve backed and the massive IPOs/exits those companies had.

The VCs themselves ran the gamut, from friendly, approachable and jovial to overly serious, harsh and distant. Intentionally or unintentionally, they all have some emotional walls up, which I believe are out of necessity and certainly don’t begrudge. If you’re meeting with dozens of entrepreneurs every week, you can’t get personally attached or build close relationships with even a fraction of them, especially if you’re not going to make an investment. It’s a very different experience from the many hundreds of other meetings I’ve had in my professional career, where establishing rapport and working in a mutually positive fashion is the norm. VCs need to drill down on specifics, call out your flaws, explain what they don’t like and gloss over a lot of positives in the process. A typical partner meeting lasts precisely one hour, and in my experience, that rarely deviated (a few times we ran over, and more than a few times things started late).

Second meetings are often pretty similar in format, though there’s typically more than one partner from the VC firm in attendance, as well as an associate or two. I also found that it was extremely helpful to bring Sarah Bird (SEOmoz’s COO and a guru when it comes to our financials) as well as Nick Gerner and/or Ben Hendrickson (who convincingly play the role of "way smarter about technology than anyone else in the room") to these meetings. They’d sometimes be a bit longer, and would almost always request a much greater degree of detail, as well as significant "objections" ot the investment, which were frequently presented as challenges we were intended to conquer using slides, data and verbal acuity.

Following both first and second meetings would be the impossible-to-parse "thanks, we’ll be in touch." We’d take guesses about which VCs were actually interested and would follow up vs. those who’d email to say "no thanks" or simply never communicate again (the latter bothered me at first, but once you realize it’s just part of the accepted cultural practice, it’s fine). Surprisingly, we were never good at this. We’d often mistakenly think one VC was interested when they weren’t and vice versa. They’re a notoriously hard-to-read bunch, perhaps intentionally.

I have a much tougher time presenting a representative partner meeting, as we only had two. They almost always take place on Monday, though, and you’re often back-to-back scheduled with pitches from other entrepreneurs. A larger, board-style meeting room will be filled with all of the firm’s partners and you’ll present the same pitch you made to the first partner to this group. Questions can get a bit strange if my experience is any guide – tangents and off-topic discussions come into play and it seems to be up to the entrepreneurs to keep things on track. I think this happens because in any given partner meeting, a good number of the partners won’t be familiar with your industry, company or technology, and may not even be interested. I imagine that if you specialize in clean-tech investments, listening to an SEOmoz pitch can get a bit boring, and you might, naturally, focus on the one or two areas you know something or have heard something about.

I will say that my experience with the vast majority of VCs we saw was not nearly as negative as what Fred Destin wrote about in his posts for VentureHacks – The Arrogant VC: Why VCs are Disliked by Entrepreneurs and Part 2. Certainly a few of these traits came out, but by and large, I felt these were responsible, talented, experienced individuals doing a hard job the best they could and putting forward both a serious effort and respect for me, my company and my time.

For a completely alternate perspective on what it was like for my wife, who accompanied me on 2 of my 5 fundraising trips, check out A little more than 24 Hours in Palo Alto and San Francisco. I do wholeheartedly recommend someone who loves you unconditionally and pretends to be unable to identify a single flaw in you, your company or your pitch, supporting you in the VC process. It can get very lonely and emotionally turbulent.

What Worked & What Didn’t

When it came time to analyze the results, we tried our best to aggregate feedback, both positive and negative, for our board meetings back in Seattle. Early on, we focused on refining the pitch, but we were (I think uncommonly) stubborn about changing our business plan or product roadmap significantly to suite investors’ opinions. We felt (and feel) strongly about the direction we want to pursue, and that may have been perceived negatively by some (though I know it was a positive to at least one investor who talked to us afterwards).

Following any "no" response, including a "no answer" within a couple weeks following the meeting, I’d email and ask for a phone call to discuss. 60%+ of the VCs we had met in person took those calls and explained to us some of their reasons for rejecting the investment.  I’d specifically ask what they liked, what they didn’t and what they recommended for us to improve. I was both impressed and grateful to receive a number of thoughtful, honest answers, and encountered only a couple of folks who clearly didn’t remember our pitch or company well enough to provide a cogent response.

Some of the things the VCs generally liked:

• The Self-Service SaaS Business Model – although there were a few dissenters who thought we should pursue a more classic SaaS business with tele-sales would be better, most were supportive of the self-service methodology.
• The Community & Userbase – that’s you! Great work, gang
• The Marketing/Sales Funnel – investors tended to like the freemium/content model that attracted potential customers at a low marketing cost
• The Technology Achievements – nearly all of the VCs with technical backgrounds were impressed by what we’d achieved with the Linkscape web index and ranking models work, particularly on such a small amount of capital.

Unfortunately, there wasn’t a clear winner in the reasons VCs didn’t want to make an investment. I did, however, make a quick chart noting which reasons were most frequently given by the investors for why chose against us:

It’s important to note that many of the VCs who said no that we followed up with gave multiple reasons for the decision. Some of these we found very reasonable and agreed with, others we struggled with. The most perturbing by far were the few folks who came back and said they didn’t like to back the consulting revenue model and would be more interested once we were more product-focused. When I’d explain that we had 80%+ of revenue for the past three years coming from the self-service SaaS product, awkward silences would follow. Still, these are investors who likely talk to hundreds of companies each year, so it must be incredibly challenging to keep things straight – and it speaks to our need to move away from consulting in our branding and perception.

The Final Outcome

It’s likely very obvious at this point that we didn’t receive term sheets or offers to fund. In actuality, that’s not technically the case – we did have firms interested, just not a the relatively high pre-money valuation numbers we sought. As you can see in the graphic above, there were a number of VCs who may have offered us terms at a lower valuation, though it’s hard to say for certain.

The reason we went in with a high valuation "ask" goes back to the very beginning of the post. From the founders’ perspective (and those of employee shareholders), an exit has to be judged through the lens of ownership percentages. If I or Gillian or Sarah owned, for example 50% of SEOmoz’s shares (none of us do - this is just an example), in a $20 million exit, we’d make $10 million. If venture capital comes in and dilutes that to 35% ownership, that number drops to $7 million in the same exit scenario. Hence, every owner of SEOmoz shares has a vested interest in seeing the final exit price reach the highest possible figure while maintaining the lowest possible level of dilution.

My understanding is that it’s very unorthodox to present a minimum pre-money valuation to investors prior to a term sheet. I believe this is because you’re potentially "laying too many cards on the table" and you may actually be hurting yourself if the VCs planned to offer a higher pre-money figure. We did it both because we like to be transparent and because we hoped to prevent ourselves from wasting time with investors who couldn’t meet our minimums. Our hope was that by giving that number in the first conversation (over the phone) and in the initial pitch deck, we’d achieve similar results as those we had in the past by publishing our prices for consulting – reduce the target market size and improve the quality.

I tell this story about our VC experience to a lot of people – it seems to be a subject that attracts great curiousity and I, of course, love to share. Most of the time, folks follow up by asking "are you disappointed?" and my answer has been the same since October. I’m not disappointed we didn’t get funded. In fact, the more time passes and the more I think about the pitfalls that could have come with another round of investment, additional board members and pressure to reach $75-$100 million in annual revenue, the more I’m glad we didn’t. However, I do regret the decision to seek funding – it cost our team countless days and weeks of productivity, took our eyes off our primary goal of delighting our members and customers and, in the end, was a learning experience with a shockingly high cost.

That said, I do think we learned a tremendous amount and really helped clarify the vision internally and to our existing board members and investors about where this company is going and what our roadmap looks like. We had dozens of smart, analytical, experienced investors reviewing our plans and ideas, and we received a lot of very positive feedback. Nearly everyone we encountered had positive things to say about the business’ future, regardless of investment, and I’m glad we were able to be in a situation where we could turn venture funding down. I have friends here in Seattle and in the Bay Area who didn’t have that luxury – who HAD to get funded, no matter the cost, because their company’s future and employees depended on it. That’s a burden I don’t wish on anyone, and I hope more and more startups are finding ways to live lean and do more with less.

So, it’s 3:45am and I’ve been working on this post on and off since before the holidays. There’s so much more I want to add, but I think I’ll leave that up to you. If you have questions I can answer, PLEASE post them in the comments and I’ll do my best to incorporate that material into the post as it makes sense. Thanks for all the support, kindness and patience – I hope this has been valuable.

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Posted by randfish

I’ve been a big fan of Chris Dixon’s excellent blog for a while now, so you can imagine that I was really excited to see him writing about SEO in a post last week. Chris kindly called out SEOmoz, which humbled me, but he also espoused some thinking in the comments that made me a bit concerned and was the catalyst for this post. Here’s how it went:

RAND: Chris – I think the biggest thing you’ve forgotten to mention is that 70%+ of the weighting/ranking used by all of the engines depends on links. If you’re not thinking about how your content and pages will incent users/bloggers/writers/media/other sites to link to your work, you’ll lose out to someone who does.

A while back I got riled up about the lack of SEO in startup marketing and wrote about it – http://j.mp/4q9zkh – might be relevant/useful, though I did write with a bit more anger than was likely deserved.

CHRIS: Rand – totally agree re links. But isn’t getting links primarily about creating great content?

Read the article you link to btw and am in complete agreement.

RAND: Tragically, at least in my experience, the answer is a resounding no. Great content is easily missed by the web’s link-heavy audience, while some pretty crummy content that’s been marketed well (or made the right connections or comes from the right sources) will tend to overperform.

The web’s link graph isn’t a meritocracy – like everything else in life, it’s a popularity contest. Those who find the best ways to distribute, promote and market their works to the audience most likely to link to it are going to succeed much more so than just the "great content" producers.

Just think of it like politics. The best, most rational, reasoned, intelligent arguments are the exception, not the rule. Instead, the conversation and media attention (and thus, public awareness) is focused on concepts that are easy to grasp, virally distributable (which often puts rumor and innuendo above fact) and fit a compelling narrative (rather than add complexity).

A post on this topic – http://j.mp/4tYThK

I would love to tell Chris that he’s right, that the better the content, the better, higher quality and greater quantity of links that content earns. But, perhaps sadly, that’s not the case. What those in the content world would call "better" does not always (nor even mostly) garner the links and rankings. Instead, those who have "better optimized" for attracting links tend to far outshine their peers with rankings and traffic.

This may seem like a tragedy, or even a travesty of the democratic structure the web is supposed to represent, but in fact, it’s the way all marketing has worked for generations. The "best" restaurants are often family-owned, hole-in-the-wall, never-marketed-themselves joints whose fabulous epicurean creations are a secret to all but the most diligent culinary Clouseaus. Meanwhile, the affront to humanity and cooking that is Olive Garden advertises relentlessly, conducts impeccable market research and appeals to the lowest common denominator in town after town to achieve geographic and market-penetration ubiquity (BTW – my wife is Italian and thus recoils at the very mention of this establishment and the tarnish it’s brought to her beloved countrymen’s kitchens).

Like many parts of life – it’s not about the quality, diligence or aptitude you bring to your field, but your ability to market it successfully. As SEOs, our responsibility is to help the best of the best become the most noticed, most beloved and most linked-to in their field. It’s a strange, almost paradoxical leap of logic, but one you internalize this principle, it gets easier to accept and to spread to your clients and managers.

p.s. I’m also a fan of Chris Dixon’s startup, Hunch – I’d urge you to check it out and try answering a few dozen questions. The results are quite fascinating.

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Posted by chenry

This post was originally in YOUmoz, and was promoted to the main blog because it provides great value and interest to our community. The author’s views are entirely his or her own and may not reflect the views of SEOmoz, Inc.

I was recently inspired by a post by MikeTek, Examining the Top 150 In-Linked Posts at SEOmoz.  While the information was very informative, it was taken from a limited sample of the over 3,800 post on SEOmoz.  Along with the small sample size, the data was not proportional to other categories and posts.  Mike encouraged anyone with a little automation skills to look into all the data on SEOmoz and really look into what makes a post link worthy. 

For this post we will be looking only at In Linking Domains (ILDs) which is a great way to determine if a post is popular throughout the net.  For example if you have a site like dummy-domain.com that links to your post 1,000 times throughout its site, it would count as 1 ILD.  A great viral post will have a large number of ILDs along with a large number of links.

LET’S START WITH THE DATA

Much like Mike’s data, there were some categories that collected more links than others.  In fact there were five categories that have the most domains linking to them, Link Building (1,448 domains), Google (1,419 domains), Technical Issues (1,243 domains), Miscellaneous (1,215 domains), and Whiteboard Friday (1,044 domains).  See the graph below for the top 30 of the SEOmoz categories.

The data in the chart above can be a little misleading because some of those categories have many more posts than others do.  To make all the data proportional, I took the total number of linking domains and divided it by the number of posts.  The chart changes considerably when the data becomes normalized.  From the chart below you can see that the top 3 categories are Webdev (19), Technical Issues (14), and On-Page Issues (10).

From the charts above it’s easy to say that “Link Building” is a very popular blog topic but it doesn’t always draw in the links like other topic can.  Part of that could be because of the difference in options on link building techniques.  Topics like “Technical Issues” and “On-Page Issues” the types of content that most people will agree on and possibly want to share with others in the business.

To take the study a little further, I stored all the post’s title’s and created a title word cloud for the top 10% of the 3,800.  This hopefully will give you an idea of what topics could have the possibility of being link worthy in your future post.  I was going to try and come up with a “Super” title based on the words in the cloud but couldn’t come up with anything catchy.  Maybe one of you Mozzers can come up with something amazing from the cloud.

Like Mike did in his previous post, let’s take a look at the content in the posts: images, list, and videos.  In the chart below you will see that having a just a list in a post compared to just text, doubles the average number of linking domains.  Have a video compared to just text will almost triple the average number of linking domains.  A post that has an image and a list will also triple the average number of linking domains to the post.

I’m sure many of you are like me and do a quick scan of the post before actually reading it.  By adding images, videos, and lists, it makes it easy to get a quick synopsis on what the post is about, encouraging people to go back and do a full read along with a possible link.  Adding Images and Lists are easy to do and could result in a post that is more link worthy.

I also recorded the length of the post to see if it had an effect on the average number of linking domains.  The length recorded was only that of the post and not the comments or other areas of the page to keep the data accurate.  I’ve read that most blog post should be kept to 500 words or less.  That information seems to be incorrect if you are going to post on SEOmoz and want it to be link worthy.  The chart below shows that posts with 1800 or more words have a much higher average of linking domains.

BIGGEST TAKEAWAYS

I feel the real take away from this post is in the last two graphics summarized below:

• Content is most important thing to a posts but posts with extra visual content attract extra links.
• By adding simple visual content, like lists and images, can increase the number of ILDs by good percent.
• Posts with videos included will attract almost 3 times more ILDs than a plain text post.
• Posts with all three media types (videos, images, and lists) will attract almost 6 times more ILDs than a plain text post.
• Contrary to common beliefs, large posts seem to attract more links than posts with 900 words or less.
• Posts with between 1800 and 3000 words will attract more than 15 times more ILDs than a post with less than 600 words.

The first part of this study was only with SEOmoz data and in the next part of this study I have decided to take on a huge project and taking a look at some of the top SEO/Internet Marketing blogs on the web.  With a larger sample size we may be able to find out if the information found during this study will hold true in other areas.  Stay tuned!

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Posted by chenry

This post was originally in YOUmoz, and was promoted to the main blog because it provides great value and interest to our community. The author’s views are entirely his or her own and may not reflect the views of SEOmoz, Inc.

I’m sure many of you are like me and one of the first things you do in the morning is head to SEOmoz and check out the blogs.  Along with seeing the new posts, I’m also always checking out my MozPoints and watching them grow, or shrink sometimes. 

In one of my past posts I did a case study of MozPoints and a few members discussed how they would like to see real-time related graphs of their MozPoints over time.   That time is now, I would like to introduce a new little side project I’ve been working on, Mozpoints.com. 

Mozpoints.com started out as a way for me to see who is moving and shaking things at SEOmoz without having to read everything and try to remember who said what.  On the main page of the site you will see it shows the “movers and shakers” for three different time periods, daily, weekly, and monthly.  It also shows some thumbing and comment stats for the time period also.

Entering your SEOmoz username or click on someone’s name will display a graph of their MozPoints.  Currently the graph only displays the lasts 30 days worth of information, but once more data is collected and stored, a new feature will become available to change the time period.  When hovering over a data point it will display a few important pieces of information, number of points, rank, number of comments, and number of posts.  MozPoint data is updated every night so this data in not exactly real-time, but close enough.

Another great little feature is the dynamic badge for your website.  This badge is much like the original that SEOmoz offers but with a new feature that self-updates your rank at SEOmoz.

I hope that this is something that the SEOmoz community will enjoy and use.  I’m hoping to hear suggestions from all of you and make this community grow and connect.  If you have any suggestions or ideas for MozPoints.com please feel free to contact me via SEOmoz or leave them in the comments.

Special thanks to Danny for giving me the idea via his comment on my previous post.

 

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Posted by randfish

It’s 9:30am and you’ve just started a pitch for a new SEO client. They’re the curious type – wanting to know how search engines rank pages, why the changes you’ll recommend will make an impact, where you learned to do SEO, and who you can list as good examples of your work. As you dive deeper into the requirements for the project, you arrive at the link building section. The client wants to know why link building matters so much. You pull up a chart of Search Engine Ranking Factors, noting the large role that links play in the ordering algorithms. They’re mollified, but have one last question:

How does Google decide how much a particular link helps my rankings?

That’s where this blog post comes in handy. Below, you’ll find a list of many of the most important factors the engines consider when judging the value of a link.

Before we start, there’s one quick concept that’s critical to grasp:

As you’ve likely noticed, search engines have become more and more dependent on metrics about an entire domain, rather than just an individual page. It’s why you’ll see new pages or those with very few links ranking highly, simply because they’re on an important, trusted, well-linked-to domain. In the ranking factors survey, we called this "domain authority" and it accounted for the single largest chunk of the Google algorithm (in the aggregate of the voters’ opinions). Domain authority is likely calculated off the domain link graph, which is unique from the web’s page-based link graph (upon which Google’s original PageRank algorithm is based). In the list below, some metrics influence only one of these, while others can affect both.

#1 – Internal vs. External

When search engines first began valuing links as a way to determine the popularity, importance and relevance of a document, they found the classic citation-based rule that what others say about you is far more important (and trustworthy) than what you say about yourself. Thus, while internal links (links that point from one page on your site to another) do carry some weight; links from external sites matter far more.

This doesn’t mean it’s not important to have a good internal link structure, or to do all that you can with your internal links (good anchor text, no unnecessary links, etc.), it just means that a site/page’s performance is highly dependant on how other sites on the web have cited it.

#2 – Anchor Text

An obvious one for those in the SEO business, anchor text is one of the biggest factors in the rankings equation overall, so it’s no surprise it features prominently in the attributes of a link that engines consider.

In our experiments (and from lots of experience), it appears that "exact match" anchor text is more beneficial than simply inclusion of the target keywords in an anchor text phrase. On a personal note, it’s my opinion that the engines won’t always bias in this fashion; it seems to me that, particularly for generic (non-branded) keyword phrases, this is the cause of a lot of manipulation and abuse in the SERPs.

#3 – PageRank

Whether they call it StaticRank (Microsoft’s metric), WebRank (Yahoo!’s), PageRank (Google’s) or mozRank (Linkscape’s), some form of an iterative, Markov-chain based link analysis algorithm is a part of all the engines’ ranking systems. PageRank et al. uses the analogy that links are votes and that those pages which have more votes have more influence with the votes they cast.

The nuances of PageRank are well covered in The Professional’s Guide to PageRank Optimization, but, at a minimum, understanding of the general concepts is critical to being an effective SEO:

1. Every URL is assigned a tiny, innate quantity of PageRank
2. If there are "n" links on a page, each link passes that page’s PageRank divided by "n" (and thus, the more links, the lower the amount of PageRank each one flows)
3. An iterative calculation that flows juice through the web’s entire link graph dozens of times is used to reach the calculations for each URL’s ranking score
4. Representations like those shown in Google’s toolbar PageRank or SEOmoz’s mozRank on a 0-10 scale are logarithmic (thus, a PageRank/mozRank 4 has 8-10X the link importance than a PR/mR 3)

PageRank can be calculated on the page-level link graph, assigning PageRank scores to individual URLs, but it can also apply to the domain-level link graph, which is how metrics like Domain mozRank (DmR) are derived. By counting only links between domains (and, to make a crude analogy, squishing together all of the pages on a site into a single list of all the unique domains that site points to), Domain mozRank (and the search engine equivalents) can be used to determine the importance of an entire site (which is likely to be at least a piece of how overall domain authority is generated).

#4 – TrustRank

The basics of TrustRank are described in this paper from Stanford – Combatting Webspam with TrustRank. The basic tenet of TrustRank is that the web’s "good" and "trustworthy" pages tend to be closely linked together, and that spam is much more pervasive outside this "center." Thus, by calculating an iterative, PageRank-like metric that only flows juice from trusted seed sources, a metric like TrustRank can be used to predictively state whether a site/page is likely to be high quality vs. spam.

While the engines don’t expose any data points around this particular metric, it’s likely that some form of the "distance from trusted seeds" logic is applied by ranking algorithms. Another interesting point on TrustRank – Reverse TrustRank, which measures who links to known spam sites, is likely also part of the engines’ metrics set. As with PageRank (above), TrustRank (and Reverse TrustRank) can be calculated on both the page-level and domain-level link graph. Linkscape uses this intuition to build mozTrust (mT) and Domain mozTrust (DmT), though our team feels that we still have a lot of work to do in refining these metrics for the future.

The key takeaways are fairly intuitive – get links from high trust sites and don’t link to potential spam.

#5 – Domain Authority

Though the phrase "domain authority" is often discussed in the SEO world, a formal, universal definition doesn’t yet exist. Most practitioners use it to describe a combination of popularity, importance and trustworthiness calculated by the search engines and based largely on link data (though some also feel the engines may use the age of the site here as well).

Search engines likely use scores about the "authority" of a domain in counting links, and thus, despite the fuzzy language, it’s worth mentioning as a data point. The domains you earn links from are, potentially, just as important (or possibly more important) than the individual metrics of the page passing the link.

#6 – Diversity of Sources

In our analysis of correlation data, no single metric has a more positive a correlation with high rankings than the number of linking root domains. This appears to be both a very hard metric to manipulate for spam (particularly if you need domains of high repute with diverse link profiles of their own) and a metric that indicates true, broad popularity and importance. You can see a list of top pages and top domains on the web ordered by the number of unique root domains with links to them via Linkscape’s Top 500.

Although correlation is not causation, the experience of many SEOs along with empirical data suggests that a diversity of domains linking to your site/page has a strong positive effect on rankings. By this logic, it follows that earning a link from a site that’s already linked to you in the past is not as valuable as getting a link from an entirely unique domain. This also suggests that, potentially, links from sites and pages who have themselves earned diverse link profiles, may be more trusted and more valuable than those from low diversity sources.

#7 – Uniqueness of Source + Target

The engines have a number of ways to judge and predict ownership and relationships between websites. These can include (but are certainly not limited to):

• A large number of shared, reciprocated links
• Domain registration data
• Shared hosting IP address or IP address C-blocks
• Public acquisition/relationship information
• Publicized marketing agreements that can be machine-read and interpreted

If the engines determine that a pre-existing relationship of some kind could inhibit the "editorial" quality of a link passing between two sites, they may choose to discount or even ignore these. Anecdotal evidence that links shared between "networks" of websites pass little value (particularly the classic SEO strategy of "sitewide" links) is one point many in the organic search field point to on this topic.

#8 – Location on the Page

Microsoft was the first engine to reveal public data about their plans to do "block-level" analysis (in an MS Research piece on VIPS – VIsion-based Page Segmentation).

Since then, many SEOs have reported observing the impact of analysis like this from Google & Yahoo! as well. It appears to us at SEOmoz, for example, that internal links in the footer of web pages may not provide the same beneficial results that those same links will when placed into top/header navigation. Others have reported that one way the engines appear to be fighting pervasive link advertising is by diminishing the value that external links carry from the sidebar or footer of web pages.

SEOs tend to agree on one point – that links from the "content" of a piece is most valuable, both from the value the link passes for rankings and, fortuitously, for click-through traffic as well.

#9 – Topical Relevance

There are numerous ways the engines can run topical analysis to determine whether two pages (or sites) cover similar subject matter. Years ago, Google Labs featured an automatic classification tool that could predict, based on a URL, the category and sub-category for virtually any type of content (from medical to real estate, marketing, sports and dozens more). It’s possible that engines may use these automated topical-classification systems to identify "neighbourhoods" around particular topics and count links more or less based on the behaviour they see as accretive to their quality of ranking results.

I personally don’t worry too much about topical relevance – if you can get a link from a topic agnostic site (like NYTimes.com) or a very specific blog on a completely unrelated subject (maybe because they happen to like something you published), I’m bullish that these "non-topic-specific" endorsements are likely to still pass positive value. I think it’s somewhat more likely that the engines might evaluate potential spam or manipulative links based on these analyses. A site that’s never previously linked-to pharmaceutical, gambling or adult topic regions may appear as an outlier on the link graph in potential spam scenarios.

 

#10 – Content & Context Assessment

Though topical relevance can provide useful information for engines about linking relationships, it’s possible that the content and context of a link may be even more useful in determining the value it should pass from the source to the target. In content/context analysis, the engines attempt to discern, in a machine parse-able way, why a link exists on a page.

When links are meant editorially, certain patterns arise. They tend to be embedded in the content, link to relevant sources, use accepted norms for HTML structure, word usage, phrasing, language, etc. Through detailed pattern-matching and, potentially, machine learning on large data sets, the engines may be able to form distinctions about what constitutes a "legitimate" and "editorially-given" link that’s intended as an endorsement vs. those that may be placed surreptitiously (through hacking), those that are the result of content licensing (but carry little other weight), those that are pay-for-placement, etc.

#11 – Geographic Location

The geography of a link is highly dependent on the perceived location of its host, but the engines, particularly Google, have been getting increasingly sophisticated about employing data points to pinpoint the location-relevance of a root domain, subdomain or subfolder. These can include:

• The host IP address location
• The country-code TLD extension (.de, .co.uk, etc)
• The language of the content
• Registration with local search systems and/or regional directories
• Association with a physical address
• The geographic location of links to that site/section

Earning links from a page/site targeted to a particular region may help that page (or your entire site) to perform better in that region’s searches. Likewise, if your link profile is strongly biased to a particular region, it may be difficult to appear prominently in another, even if other location-identifying data is present (such as hosting IP address, domain extension, etc).

#12 – Use of Rel="Nofollow"

Although in the SEO world it feels like a lifetime ago since nofollow appeared, it’s actually only been around since January of 2005, when Google announced it was adopting support for the new HTML tag. Very simply, rel="nofollow", when attached to a link, tells the engines not to ascribe any of the editorial endorsements or "votes" that would boost a page/site’s query independent ranking metrics. Today, Linkscape’s index notes that approximately 3% of all links on the web are nofollowed, and that of these, more than half are sites using nofollow on internal, rather than external pointing links.

Some question exists in the SEO field as to whether, and how strictly, each individual engine follows this protocol. It’s often been purported, for example, that Google may still pass some citation quality through Wikipedia’s external links, despite the use of nofollow.

#13 – Link Type

Links can come in a variety of formats. The big three are:

1. Straight HTML Text Links
2. Image Links
3. Javascript Links

Google recently announced that they’re not only crawling this third group, but passing link endorsement metrics through them (which has many upset about the reversal in policy about using Javascript as a way to delineate paid/advertising links). For years now, they’ve also treated the text in an image’s alt attribute in a similar fashion to how anchor text is handled in standard text links.

However, not all links are treated equally. In both anecdotal examples and testing, it appears that straight, HTML links with standard anchor text pass the most value, followed by image links with keyword-rich alt text and finally, Javascript links (which still aren’t universally followed or considered as  an endorsement, at least in our experience). Link builders, content licensers, badge and widget creators and those who enable embeddable content should all, in my opinion, assume the worst about the engines’ ability to handle and pass value from non-standard links and aim to get HTML text links with good anchor text as an optimal methodology.

#14 – Other Link Targets on the Source Page

When a page links out externally, both the quantity and targets of the other links that exist on that page may be taken into account by the engines when determining how much link juice should pass.

As we’ve already mentioned above (in item #3), the "PageRank"-like algorithms from all the engines (and SEOmoz’s mozRank) divide the amount of juice passed by any given page by the number of links on that page. In addition to this metric, the engines may also consider the quantity of external domains a page points to as a way to judge the quality and value of those endorsements. If, for example, a page links to only a few external resources on a particular topic, spread out amongst the content, that may be perceived differently than a long list of links pointing to many different external sites. One is not necessarily better or worse than the other, but it’s possible the engines may pass greater endorsement through one model than another (and could use a system like this to devalue the links sent from what they perceive to be low-value-add directories).

The engines are also very likely to be looking at who else a linking page endorses. Having a link from a page that also links to low quality pages that may be considered spam is almost certainly less valuable than receiving links from pages that endorse and link out to high quality, reputable domains and URLs.

#15 – Domain, Page & Link-Specific Penalties

As nearly everyone in the SEO business is aware (though those in the tech media may still be a bit behind), search engines apply penalties to sites and pages ranging from the loss of the ability to pass link juice/endorsement all the way up to a full ban from their indices. If a page or site has lost its ability to pass link endorsements, acquiring links from it provides no algorithmic value for search rankings. Be aware that the engines sometimes show penalties publicly (inability to rank for obvious title/URL matches, lowered PageRank scores, etc.) but continue to keep these penalties inconsistent so systemic manipulators can’t acquire solid data points about who can gets "hit" vs. not.

#16 – Content/Embed Patterns

As content licensing & distribution, widgets, badges and distributed, embeddable links-in-content become more prevalent across the web, the engines have begun looking for ways to avoid becoming inundated by these tactics. I don’t believe that the engines don’t want to count the vast majority of links that employ these systems, but they’re also wary about over-counting or over-representing sites that simply do a good job getting distribution of a single badge/widget/embed/licensing-deal.

To that end, here at SEOmoz, we think it’s likely that content pattern detection and link pattern detection plays a role in how the engines evaluate link diversity and quality. If the search engines see, for example, the same piece of content with the same link across thousands of sites, that may not signal the same level of endorsement that a diversity of unique link types and surrounding content would provide. The "editorial" nature of a highly similar snippet compared to those of clearly unique, self-generated links may be debatable, but from the engines’ perspectives, being able to identify and potentially filter links using these attributes is a smart way to future-proof against manipulation.

#17 – Temporal / Historical Data

Timing and data about the appearance of links is the final point on this checklist. As the engines crawl the web and see patterns about how new sites, new pages and old stalwarts earn links, they can use this data to help fight spam, identify authority and relevance and even deliver greater freshness for pages that are rising quickly in link acquisition.

How the engines use these patterns of link attraction is up for debate and speculation, but the data is almost certainly being consumed, processed and exploited to help ranking algorithms do a better job of surfacing the best possible results (and reducing the abilities of spam – especially large link purchases or exploits – to have an impact on the rankings).

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While the list above includes many data points, it’s almost certainly not comprehensive. Please feel free to suggest others that belong here in the comments below.

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Posted by randfish

Linkscape has always been a project with a lot of promise. Building a crawl of the WWW that can expose link data in interesting ways, calculating metrics in the ways search engines do and surfacing potential SEO opportunities are all a part of that, but it’s a lot of work and time to get all the potential functionalities into real-life tools. Last week, Linkscape took a giant leap forward in usefulness with Nick’s new Competitive Link Finder.

Here’s how it works:

1. Takes a pair of inputs – your website and the websites of 2-5 competing sites (or sites in the same sector)
2. Uses a link graph of 443 Billion Links to find link intersects between those pages (URLs that have links to 2+ of the sites you’ve entered but may not have links to your site)
3. Exposes a list of domains, with each linking page underneath along with metrics about those pages and sites.

Getting started is really simple. Just enter your own site, plus up to 5 competitors and the tool will find pages on the web that point to two or more of those pages, then list those in descending order of importance. The tool currently lives inside our SEOmoz Labs (which houses a ton of our best stuff) at http://www.seomoz.org/labs/link-intersect. We don’t have fancy graphics or great UI in Labs, but the functionality takes center stage:

The results look like this:

For each domain that’s mentioned, you can see a breakout list of the pages that point to those URLs, a checkmark next to the domains you’ve already earned a link from and data on the importance of the domains and pages (Domain mozRank and mozRank, respectively) listed. When you click the number of links from any given site, the tool surfaces a list of those exact pages, making it easy to see where and how they’ve earned those links. The features are just killer:

• The tool ignores nofollow links, so you’re only seeing pages that have actual, live links to at least two of your competitors
• As our metrics (DmR, mR, DmT, etc.) have improved over time, the results really do feel like they’re ranked in order of importance/potential value
• The data is extremely comprehensive – since Linkscape crawls a dramatic portion of the "important" web, the probability of finding great links is very high
• When SEOs talk about "hubs" from the Hubs & Authorities link model of the web, that’s exactly what this tool is finding. Thus, you may see even more benefit from attaining these links than the raw metrics might indicate
• The tool includes pagination, so you can see hundreds, sometimes thousands of potential link sources and every new competitor or site you add is a new opportunity to discover more link resources
• Don’t just limit yourself to narrow competitors – plug in any site in your field that’s roughly related and you can find the intersection of potential links; the possibilities for finding links with this tool are limited only by your ability to plug in new sites and pages

The Competitive Link Finder is currently available only to PRO members (who have unlimited access for now). However, tonight, we’re opening the link finder to all SEOmoz members; just log in to your account and for the next 24 hours (until 11:55pm Pacific, Thursday September 2nd) you can try out the tool yourself.

QUICK WARNING: We haven’t exposed this much Linkscape data to so many people in the past, so things may slow down a bit. If you’re finding the tool takes a few minutes to run, don’t panic – the web is really, really big, so it’s a bit complex to run data calculations like this

I’m a fairly tough critic, but I have to say that every time I’ve used this tool myself or shown it off in the last few weeks, people have been incredibly impressed. Nick, Sarah and I spent the latter half of last week on Sand Hill Road pitching VCs, and I can honestly say that even they were really, really amazed by how high quality and useful the results are. Link building is, according to most SEOs, the hardest task we collectively engage in. I think the work here from Nick (built on the backbone of Linkscape that he and Ben developed) is finally making that process an order of magnitude more do-able.

p.s. I’d like to call out some of the other tools on the web which also leverage the concepts of link intersection. While I’m a personal fan of this one, there are some other good resources for those seeking link co-occurrence. The first tool of this variety used link data from a number of search engines back in the 1990’s (I believe it was operated under WebsiteGarage which shut down in 2002). Jim Boykin’s WeBuildPages also featured a free tool that used Yahoo! link data (now available under their Ninjas program), as did the software package WebCEO (though it appears to no longer be included). SEOBook (of which I’m a big fan) also released a Hub Finder tool in 2005, which was almost certainly the best iteration to date (note: I’m a paying member at SEOBook). Like Newton, we’ve been very lucky to see far by standing on the shoulders of giants, and I remain indebted to the terrific community around the SEO world.

p.p.s. Sadly, we’ve had to turn off access, but more than 30,000 reports have been run just today! If you’d like to try the tool, PRO is the way to go.

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Posted by randfish

Linkscape has always been a project with a lot of promise. Building a crawl of the WWW that can expose link data in interesting ways, calculating metrics in the ways search engines do and surfacing potential SEO opportunities are all a part of that, but it’s a lot of work and time to get all the potential functionalities into real-life tools. Last week, Linkscape took a giant leap forward in usefulness with Nick’s new Competitive Link Finder.

Here’s how it works:

1. Takes a pair of inputs – your website and the websites of 2-5 competing sites (or sites in the same sector)
2. Uses a link graph of 443 Billion Links to find link intersects between those pages (URLs that have links to 2+ of the sites you’ve entered but may not have links to your site)
3. Exposes a list of domains, with each linking page underneath along with metrics about those pages and sites.

Getting started is really simple. Just enter your own site, plus up to 5 competitors and the tool will find pages on the web that point to two or more of those pages, then list those in descending order of importance. The tool currently lives inside our SEOmoz Labs (which houses a ton of our best stuff) at http://www.seomoz.org/labs/link-intersect. We don’t have fancy graphics or great UI in Labs, but the functionality takes center stage:

The results look like this:

For each domain that’s mentioned, you can see a breakout list of the pages that point to those URLs, a checkmark next to the domains you’ve already earned a link from and data on the importance of the domains and pages (Domain mozRank and mozRank, respectively) listed. When you click the number of links from any given site, the tool surfaces a list of those exact pages, making it easy to see where and how they’ve earned those links. The features are just killer:

• The tool ignores nofollow links, so you’re only seeing pages that have actual, live links to at least two of your competitors
• As our metrics (DmR, mR, DmT, etc.) have improved over time, the results really do feel like they’re ranked in order of importance/potential value
• The data is extremely comprehensive – since Linkscape crawls a dramatic portion of the "important" web, the probability of finding great links is very high
• When SEOs talk about "hubs" from the Hubs & Authorities link model of the web, that’s exactly what this tool is finding. Thus, you may see even more benefit from attaining these links than the raw metrics might indicate
• The tool includes pagination, so you can see hundreds, sometimes thousands of potential link sources and every new competitor or site you add is a new opportunity to discover more link resources
• Don’t just limit yourself to narrow competitors – plug in any site in your field that’s roughly related and you can find the intersection of potential links; the possibilities for finding links with this tool are limited only by your ability to plug in new sites and pages

The Competitive Link Finder is currently available only to PRO members (who have unlimited access for now). However, tonight, we’re opening the link finder to all SEOmoz members; just log in to your account and for the next 24 hours (until 11:55pm Pacific, Thursday September 2nd) you can try out the tool yourself.

QUICK WARNING: We haven’t exposed this much Linkscape data to so many people in the past, so things may slow down a bit. If you’re finding the tool takes a few minutes to run, don’t panic – the web is really, really big, so it’s a bit complex to run data calculations like this

I’m a fairly tough critic, but I have to say that every time I’ve used this tool myself or shown it off in the last few weeks, people have been incredibly impressed. Nick, Sarah and I spent the latter half of last week on Sand Hill Road pitching VCs, and I can honestly say that even they were really, really amazed by how high quality and useful the results are. Link building is, according to most SEOs, the hardest task we collectively engage in. I think the work here from Nick (built on the backbone of Linkscape that he and Ben developed) is finally making that process an order of magnitude more do-able.

p.s. I’d like to call out some of the other tools on the web which also leverage the concepts of link intersection. While I’m a personal fan of this one, there are some other good resources for those seeking link co-occurrence. The first tool of this variety used link data from a number of search engines back in the 1990’s (I believe it was operated under WebsiteGarage which shut down in 2002). Jim Boykin’s WeBuildPages also featured a free tool that used Yahoo! link data (now available under their Ninjas program), as did the software package WebCEO (though it appears to no longer be included). SEOBook (of which I’m a big fan) also released a Hub Finder tool in 2005, which was almost certainly the best iteration to date (note: I’m a paying member at SEOBook). Like Newton, we’ve been very lucky to see far by standing on the shoulders of giants, and I remain indebted to the terrific community around the SEO world.

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Posted by Dr. Pete

Warning: This post contains tactics that may be considered black-hat. SEOmoz does not condone these practices. I have simply done something dumb to my own website to prevent you from doing something dumber to yours.

If you believe the rumors, we all now live in something called the real-time web. The once steady trickle of user-generated content became a torrent, and search engines face the difficult task of drinking from a fire hose without drowning. It only stands to reason, then, that fresh content is becoming more important, and anecdotal evidence seems to back that up. Every day, blog posts and Tweets seem to get indexed and ranked a bit faster.

Freshness seems important, but what signals does Google use to determine freshness? Beyond the original cache date, do the spiders pay attention to on-page signals, such as dates in body content or URLs? I thought it might be fun to try and find out.

1. Manipulating URLs (non-301)

My plan started out simple: manipulate a URL on my blog and rename it to use a date-based format (as some blogs do by default). So, for example, a URL that normally looked like this:

http://www.mysite.com/topic-goes-here

…became something like this…

http://www.mysite.com/2009-09-01-topic-goes-here

I chose a blog post that was recent enough to still be archived and spidered but not so recent or popular that it was likely to attract new inbound links. I chose 3 long-tail keyword phrases to track for that post, and then flipped the switch and changed the URL. In part 1 of this experiment, I did not 301 the old URL to the new one. By not 301’ing, I was hoping to nudge Google into updating the original cache date. The graph below shows what happened:

The rankings axis is inverted to show low rankings at the top, with 1 line for each keyword phrase. Here’s where things got weird. Even after spiders indexed the new URL, that URL showed up in rankings on 3 different days for the 3 phrases (indicated by the gray, dotted lines). Some rankings dropped before the new URL appeared, others after, until they eventually stabilized slightly lower than the original URLs. Oddly, the one keyword that hit #1 after the switch also managed to cache the 404-error (so, that ranking was completely useless).

2. New URLs, Take Two (301)

Of course, outright changing a URL without 301 redirecting it is a bit unusual, and would mean that I lost whatever inbound link juice I had flowing to that page (it wasn’t much, but it still can’t be ignored). So, not generally one to learn from my mistakes, I tried again, this time with a new blog post but with a 301 in place.

Not surprisingly, the spiders were a bit better behaved, with all 3 rankings reflecting the new URL on the same day. Somewhat surprisingly, though, some keywords lost ranking, some gained, and the overall average ranking change was roughly a wash. Not a promising sign for my URL-based freshness theory.

3. Mad Science Is Science, Too

So, what can we learn from my little experiment in freshness? I’m not entirely sure, but I’d like to offer a few takeaways to trick you into believing that reading this post was a good idea:

(1) Google Isn’t That Dumb
If you were considering changing all your URLs to trick Google into thinking that your posts are brand, spanking new, here’s some advice: don’t.

(2) Always, Always 301
Although I had my reasons for not using 301s in the first experiment, don’t ever rename an important URL without redirects in place. If nothing else, Graph (I) should be a lesson in what can happen if you do.

(3) Proceed With Caution
Even if you do rename your URLs for a perfectly good reason, and you put 301s in place, expect some short-term consequences. Rankings may fluctuate, and where you end up when you’re done might not be exactly where you started. Changing your URL structure is a big job – sometimes, it’s necessary, but don’t do it just to make a minor SEO tweak.

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