When three co-founders launched an online community for SEO professionals called Traffic Think Tank in 2017, they had their doubts that members would pay $99 per month.
But they knew charging for the community – rather than offering it as a free resource – would increase the quality of the members and their interactions.
They went for it, and it worked.
Years later, Matthew Howells-Barby, Ian Howells and Nick Eubanks were approached by bigger companies interested in buying their community business. But none seemed like the right home for what they’d built.
“Frankly, we struggled to see a situation where we’d feel confident enough in the buyer for us to hand over the keys to the kingdom,” Howells-Barby wrote in a post on his website. “The community was more than a company to us, it was part of our identities. We were founding members, after all.”
Eventually they were approached by SEO giant Semrush – which Howells-Barby had advised and which they all respected. Semrush had previously acquired companies such as Backlinko, an SEO training website and newsletter.
This time, the partners felt comfortable selling their prized creation.
Semrush purchased it in 2023 for $1.8 million in cash, of which $360,000 was to be paid in 12 months and another $360,000 was to be paid in 18 months. (The founders declined to discuss the sale price. They Got Acquired found the price in a public SEC filing.)
“It was the first time that we’d all universally agreed that this could be a buyer that would be truly additive to the community as a whole,” Howells-Barby wrote.
The crazy thing is, this was always a side gig for the three founders. For six years, they were juggling it alongside their full-time jobs.
Why sell at all? “We didn’t have the time required to take it to the next level,” Howells-Barby told They Got Acquired.
The community value of Traffic Think Tank
Back in 2014, Howells-Barby got invited into a small, private Facebook group where top SEO experts shared strategies that had worked for them. The cardinal rule: Nothing was to be leaked outside the group.
“Once a tactic becomes public knowledge, it’s done to death and becomes less effective,” he wrote on his website. It was the first time he realized how powerful online communities could be.
In 2017, he and his two co-founders – who were all members of the Facebook group – launched Traffic Think Tank. They organized it like this:
- Charge a $99-per-month subscription for access to a private Slack community.
- Publish a new piece of educational content every week.
- Allow members to ask them questions directly.
- Host a monthly live Q&A on Zoom.
They debated whether to initially offer access to the community for free. Free access would bring more people in faster, but charging for access would eliminate spam. “I’ll be the first to admit that I was extremely skeptical of the idea that people would pay $99 per month to be part of a Slack community,” Howells-Barby wrote.
It worked out, though. They limited their community to 100 members at first, and they quickly maxed that out. While they focused on educational content, it became apparent that Traffic Think Tank was really in the business of personal connections. The more connections it facilitated, the more valuable it became.
“We did everything we could to lean into this and spent the lion’s share of our time obsessing over building a brand in the space people would trust and feel an affinity to,” Howells-Barby wrote.
As the community grew over the years, the co-founders began to consider their options for what to do next. By the time they sold, Traffic Think Tank employed three part-time contractors and had more than 750 active members. It had more than 300 hours of educational videos, on-demand courses, and tens of thousands of messages posted per month. And it was bringing in about $1 million in ARR (annual recurring revenue), according to one founder’s LinkedIn profile.
“We knew that either we needed to consider bringing on additional partners or building out the team more significantly, or looking at something like an acquisition to really level up kind of on the growth side,” Howells-Barby told the website Search Engine Journal. “We grew the team pretty significantly, but we realized that that still wasn’t delivering what we needed.”
This founder’s advice for selling your company
Howells-Barby offered three pieces of advice for anyone who’s considering a sale at some point:
- Pick your co-founders carefully.
- Do administrative work early to prepare for extensive due diligence.
- Optimize for customer experience instead of revenue expansion.
“Selling to a public company is a marathon,” Howells-Barby said. “Three different diligence firms, the best part of a year of diligence, and tons of hoops to jump through.”
He was quick to compliment Semrush on their patience and flexibility, but the acquisition process was inevitably a pain. Still, it would have been more of a nightmare if the operators of Traffic Think Tank hadn’t been organized administratively.
“The less organized a business is, the more difficult it is to sell,” Howells-Barby wrote on his website.
An online community where intellectual property is created by its customers presents unique challenges. His advice: Work with lawyers early on to ensure you have the right user agreements, terms and contracts in place, so your business actually owns all of that IP.
The same goes for all of your founder and employee equity agreements: “The last thing you want to be doing during a sale process is fixing a mess within your ownership structure.”
Regarding his advice to choose your co-founders carefully: He didn’t have any problems with his. But he can see how, if there’s any friction between co-founders, the acquisition process could make it worse.
His final bit of advice is specifically for community-related businesses: “Your customers are also the product. The less satisfied those customers are, the less valuable the community is as a whole.”
That’s why they turned down the opportunity to earn a significant amount of affiliate revenue by promoting software to their community members, a loyal following of digital marketers.
Semrush keeps expanding
In February 2023, Traffic Think Tank was acquired by Semrush. Headquartered in Boston, Semrush is a popular SEO tool used by marketers for keyword research and competitor analysis that’s been around since 2008.
The TTT acquisition enables Semrush to expand its “Semrush Academy,” where marketers can learn new skills and hone their craft with access to communities focused on SEO, content marketing, social media and digital PR.
“The TTT mission will be maintained, and its community will be able to benefit from the content and resources already produced by the Semrush Academy, as well as new content and additional sessions from industry experts,” Semrush said in its acquisition announcement.
TTT’s co-founders stayed on as consultants. “We’ve stayed on board as advisors, but this was never my full-time gig anyway,” Howells-Barby told They Got Acquired. “I took a few months out to spend time with my family and plan my next move.”
Howells-Barby is now vice president for growth at Kraken Digital Asset Exchange, a crypto trading platform. Ian Howells is head of SEO for digital marketing agency The Grit Group. Nick Eubanks is vice president of owned media for Semrush as well as being a partner in the venture studio Super Limited Co., which buys, builds and operates digital assets.
Besides Traffic Think Tank, Semrush has acquired at least three other companies in the last four years.
- In 2022, Semrush acquired Backlinko, an SEO training website and newsletter. Backlinko’s largest growth driver was its email list, which had nearly 175,000 subscribers, including marketers from companies like Apple, Disney, IBM and Amazon.
- Also in 2022, Semrush acquired Kompyte, a competitive intelligence automation and sales enablement platform. Kompyte is an AI-driven solution designed to simplify the tracking and analysis of competitor insights for sales, marketing, product development and executive teams.
- In 2020, Semrush acquired the public relations SaaS tool Prowly. Prowly describes itself as an all-in-one workflow automation solution for PR professionals where they can create press releases, manage email pitches and do media monitoring.
