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Netpeak Buys an Agency Online: A Real-Time Experiment

Netpeak has helped to grow the businesses of over 2000 clients from 47 countries. Today, our international agency has offices located in seven cities across four countries.

When scaling, we sometimes use the conventional method of office rentals, regional representatives, and searching for local candidates. However, we also like to use a different and quicker way of merging with local players.

In 2014, we entered the Bulgarian market by buying 51% of Optimization.bg. We liked their approach it is as close as possible to the principles of current SEO while they liked the organization, smooth business processes, and systematic approach used by Netpeak.

We want to use the same method again to enter a new market, and it may be yours. But let's talk about that a little bit later. For now, meet the hero of this merger story Gennady Vorobiev, entrepreneur, founder, and CEO of Netpeak Bulgaria (previously Optimization.bg). Thanks to the merger with Netpeak, Gennady's team now has ten times more revenue, five times more staff, and four times more projects in just four years.

The Unbelievable Story of Netpeak Bulgaria and Gennady Vorobiev

The Unbelievable Story of Netpeak Bulgaria and Gennady Vorobiev

Gennady was born and raised in the cozy town of Izmail in the Odessa region. He then moved to Bulgaria to join the Faculty of Mathematics and Computer Science in Shumen. As Gennady taught at the Mathematics Department and processed bookings for a travel agency, he became interested in online projects. Then it happened: he got a job at an online booking company and worked on project promotion, both in the office and on the freelance market.

Finally, Gennady decided that he had enough on his plate, and he started his own SEO agency. That is how the website and the legal entity Optimization.bg came to be. In the same year, together with Nikolay Galinov (then link builder and now SEO Team Lead at Netpeak Bulgaria) and other partners, Gennady launched an e-commerce project selling cell phones. Sales grew steadily as the site ranked among the top positions in organic search, and the specialists optimized the site. Everything went perfectly well until the project fell under the Penguin filter from Google.

After that, Gennady and his specialists joined the white hat optimizers, almost stopped buying links, and started focusing more on content.

In 2013, his agency Optimization.bg had its first office on the 18th floor in central Sofia. The team consisted of six people.

Work saturday and beautiful mountain view @ #netpeakbg

Публикация от Netpeak Bulgaria (@netpeakbg)

At the same time, Gennady became friends with the proponents of white hat SEO Alexander Maksimenyuk (Ringostat) and Oleg Salamaha (Serpstat). By then, Netpeak's products had gained clients in Bulgaria, and Gennady's company had received access to new promotion tools.

Yes baby!

Posted by Gennadiy Vorobyov on Friday, January 24, 2014

Not long after, the founder of Netpeak Group, Artem Borodatyuk, invited Gennady to the headquarters of the Netpeak agency for a tour. On the terrace of the business center, Artem recalled how he once went through a "four-year crisis", which is typically experienced by all founders and CEOs of agencies.

This crisis happens precisely when all the reserves of inner enthusiasm are drained after the start of the business; when the monotony becomes exhausting and instead of prospects, one can only see the massive amount of work needed to survive. The job starts to involve fine-tuning the business processes, creating an incentive system for each role, creating work standards, hiring and training new people, changing the format of the current team, and so on.

The profit from the business, however generous, often doesn't compensate for this burden. The feasibility of the whole endeavor starts to be questioned. This is why so many SEO and PPC specialist teams last for no longer than four years. Unless, of course, they want to settle for very little.

Regardless of scale and turnover, clients who approach internet marketing agencies frequently struggle to get in the black because of the low margin and high complexity of the service business model. This is often true when a consulting service is offered rather than a ready-made commodity or a software product. It is possible to sustain a steady salary, but to develop a team, you need either a lot of time to grow gradually or extra money and investments (which are difficult to attract due to low margins).

Small agencies are especially prone to falling into this trap, and the founder and head of the business could be placed on the verge of complete burnout.

There are two effective strategies to get out of this situation:

  1. Become a big agency by skipping the mid-sized business stage. This is what Netpeak did. However, this approach means completely rebuilding the company and bringing it to the next level, reorganizing business processes, and so on.
  2. Enter the premium segment while remaining a small agency, i.e., charge more than the market average and become a so-called "boutique agency." But to use this strategy, the entire business has to be based on the founder and his or her reputation. At a recent event, Google representatives shared a worrying statistic: if your agency has three clients generating more than 60% of the turnover you should be prepared to close. According to Google specialists, ideally, one client should not produce more than 30% of the turnover.

    Artem and Gennady discussed these options and went home. Soon, the idea was born that Optimization.bg would use Netpeak's experience and go over to the big business niche. At the same time, Netpeak would access the European market through the Bulgarian agency. The founders of the agencies met again, conducted a due diligence review of the financial conditions of Optimization.bg, and agreed on the evaluation and terms of cooperation.

    Thus began the process of merging businesses under the Netpeak brand. The team leaders made a training project, "How to Become Netpeak", and all the Optimization.bg staff took it. That's when the Netpeak team structure was equipped with an incentive system and career progression options from Junior to Team Lead.

    In four years, the number of Netpeak Bulgaria employees has increased fivefold. In 2016, a sales department was established, and a full-fledged team of contextual advertising specialists was formed in 2017.

    Not only that, Gennady's team had access to all of Netpeak agency's software developments, methodologies, and structured experience. Let's describe the benefits in more detail because this is what we offer (besides money, of course) for the business development of our future partners.

    The benefits enjoyed by an agency that joins Netpeak

    Here is what Gennady's team received (and what your agency will most likely get) when Optimization.bg merged with the Netpeak agency.

    1. Team organization:
    1.1. Organizational structure: a career ladder and development plan for each role.
    1.2. KPI-based incentive systems for employees.
    1.3. Additional control over the time management of specialists with an internal system and Yaware.
    1.4. Internal Wikipedia with a full set of manuals and guides for each process and role.
    1.5. The use of Netpeak Group holding products (Serpstat, Netpeak Software, and Academy Ocean) at special rates.
    1.6. Netpeak Scriptum software for generating unique commercial offers based on effective templates.
    1.7. The possibility of publishing articles in Netpeak Journal that has over 250,000 views monthly.
    1.8. Opportunities to attend our conferences, including 8P, OA, and SaaS Nation.

    Opportunity to attend our conferences: 8P, OA, SaaS Nation

    1.9. Well-established business processes that are based on employee autonomy and initiative. For example, if an employee wants to attend a training seminar, they can make a request for tickets through the Seminars section of the internal ERP system, and the tickets will be ordered.
    1.10. The Netpeak website has a section with vacancies and candidates, which is essentially a CRM system for working with recruiting.
    1.11. An internal forum to discuss innovations and use collective intelligence to solve complex issues.
    1.12. Training materials and common core and non-core training events.
    1.13. Corporate culture including mission, values, and goals.
    1.14. Internal currency ("Netpeaks") and the Netpeak Store, where you can buy various products with this currency.

    Netpeak Store

    1.15. A section of the Education Center with the ability to conduct courses and nurture talented and capable employees.
    1.16. A gamification system to increase motivation among employees: badges, ratings, and awards.
    1.17. An internal memo generator.

    2. Project management panel: an in-house ERP system for data aggregation and analytics, work automation, and preparation of digests.
    2.1. The Netpeak ERP system automatically accrues vacation days, visualizes data about employees on vacation, and sends messages to staff that this employee is going on vacation.
    2.2. The Project Management Dashboard keeps track of employee attendance.
    2.3. The ERP system allows you to keep financial records of projects.
    2.4. The project management panel can record employee salaries, generate digests of debts and plus-percentages, and write payment reminders.
    2.5. PUP monitors staff productivity and employee morale. For example, at the end of the day, all staff indicate their efficiency in the system as a percentage (from zero to 200) and outline the tasks they have performed. We have an automatic system that monitors the motivation levels of employees. The system aims to prevent the problem of professional burnout.
    2.6. All employees can send reports on bugs or share their ideas, from "something doesn't work" to "I wish we could change the logo color to green." The system also transfers money between employees and sends requests for equipment, books, events, etc.
    2.7. The agency's ERP system is integrated with Planfix's CRM, where all work on tasks occurs.

    3. General improvements for clients.
    3.1. Quality standards of the services provided.
    3.2. Synergy of specialists: to achieve maximum results for the business, additional specialists can always be recruited into project promotion. Large projects are assigned special departments comprising specialists of different profiles to maximize the productivity of the project.
    3.3. An ROI-oriented approach, which is the basis of the Netpeak brand.
    3.4. A Personal Dashboard, where all information about project progress is accumulated and visualized, previous comments from specialists are stored, and much more. The dashboard is an actual project control panel where you can control the performance of the website and the landing page, detail the balance, monitor the quality of the implementation of technical tasks, and keep track of KPIs for all traffic sources. Everything can be done with a click or two.
    3.5. Effect of scale: we have data on millions of domains in different segments. We also view and analyze millions of search queries and ads.

    The staff in Sofia have created a local language version of the Netpeak blog and successfully use it to educate the public, share their experiences, and generate new applications.

    In April 2016, Netpeak Bulgaria won the local Forbes rating of E-Volution Awards in the category of SEO Agencies.

    E-Volution Awards in the category of SEO Agencies

    Netpeak Bulgaria have begun to influence the market development in their country. Their staff co-organized a major conference on Internet marketing and are actively supporting various educational projects.

    How Netpeak Bulgaria is developing internet marketing in the country

    In 2016, Netpeak became the organizer of the largest forum for promotion and Internet advertising specialists in Bulgaria and held the first such conference known as Online Advertising (previously SEO Conference). A year later, another meeting took place, and as many as two conferences were planned in 2018. The virtual conference Online Advertising Live Edition gathered more than 2,000 participants on March 27th, 2018, and the traditional offline conference was held in late October 2018.

    Netpeak Bulgaria has also co-organized three-month Internet marketing courses at the newly created Software University since 2013. More than 2,000 students in two courses have graduated from the university. The teaching staff of the classes (including six Bulgarian team members from the departments of paid traffic, marketing, and SEO) merged into a separate structure in 2016 - Softuni Digital - the Department of Digital Marketing. In two years, the faculty has produced more than 1,000 graduates who have taken courses on marketing basics, content marketing, email marketing, Facebook Ads, Google Ads, SEO, and e-commerce.

    The Netpeak Bulgaria team is growing rapidly with several offices in Sofia and Varna:

    The Netpeak Bulgaria team is growing and has already changed several offices in downtown Sofia

    The Bulgarian staff are regularly featured on the covers of local business publications.

    The guys are regularly featured on the covers of local business publications

    Netpeak Bulgaria specialists have been entrusted with projects from leading Bulgarian brands and major international brands such as IKEA and Peugeot. Gennady has been invited to national television as a website promotion expert and has ambitious plans for the upcoming years.

    We want to repeat the successful experience of entering new regions

    It took us a lot of time to migrate the agency to Netpeak and evaluate the results thoroughly. We systematized and organized this complex process; as a result, Bulgaria has become Netpeak's second-highest revenue market.

    Now, we are looking to repeat the experience and once again find and buy a local SEO and/or PPC team. As you can see in this article, we are making an out-of-the-box offer. We want to find those who already know about us and are familiar with our approach.

    Yes, we know that the merger outlined in this article is quite different as Optimization.bg was the first to join us in this manner. That said, million-dollar deals have been struck by just chatting in the comments under tweets, without knowing each other in person. So why not keep an open mind?

    Whom are we looking for?

    We are not open to merging with absolutely everyone and are not looking to buy super-big players. We are looking for a team of specialists of up to 20 people with three to four years of online promotion experience. Ideally, our future partners should specialize in search engine promotion and contextual advertising. They should also have an approach that is similar to ours with regards to the client's business development and the desire to grow and educate market players.

    We are especially interested in the following countries: Austria, Germany, Greece, Georgia, Israel, Spain, Lithuania, Poland, Turkey, France, and the Czech Republic.

    Want to join Netpeak? Here is a checklist with our requirements. 

    • The founder and CEO must be familiar with Netpeak.
    • The founder needs to be fluent in Ukrainian, English, and Russian.
    • The founder should know the leading players in the local market and the main advertisers.
    • At least three years of experience in promoting different projects.
    • A team of five people or more.
    • SEO and PPC competence with a profit share of 60% or more from contextual ads and search campaigns.
    • The agency either has already completed web development or is ready to do so.
    • Feedback from big players and projects is mandatory.
    • The brand needs to have a good reputation on the market.

    The Netpeak Group is ready to acquire business projects from all over the world. We are looking for small agencies, mobile applications, and SaaS companies ready to actively grow with us. Learn more about the benefits of business collaboration with an agency and a group of companies. Are you on your way to join us? Email investments@netpeak.net.
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