Pay yourself a fair fee and put pressure on yourself. This will create the background for professional management to jump in after you
Vladan Hejnic is a serial entrepreneur, co-owner and CEO of VIVnetworks, Targito and Contentiamo.
VIVnetworks is the largest and most powerful affiliate network in Central and Eastern Europe. Targito is a data-driven communication platform (email marketing and personalized websites) for large retailers and e-commerce players. Contentiamo is an emerging affiliate platform for influencers.
Vladan has been in technology for 29 years, mostly in sales. He is a technology innovation enthusiast, adrenaline sports lover and a fan of self-development.
In this episode, we discuss:
How does affiliate marketing work and what is its reputation?
How does he stay on top of the competition and where does he get his inspiration?
How does he fund new project launches and what does he think about start-ups?
When does he withdraw from project and how does he select management?
Why is the company brand important to him and how does he plan to use it?
Important links:
INTERVIEW TRANSCRIPT
Martin Hurych
Hello, I'm Martin Hurych and this is... This is Ignition.
Ignition is the beginning of acceleration, and acceleration is something you need to get moving from a standstill. By finding this podcast, which I thank you for by the way, you have taken the most important step towards your acceleration, the first step. At Ignition, we share experiences from B2B business, from business, from innovation, from working with people and more.
Today we will accelerate with Vladan Hejnic.
Hey, Vladan.
Vladan Hejnic
Hi, Martin.
Martin Hurych
Vladan, before we start introducing your companies, let's start with three companies, a turnover of over a quarter of a billion, paragliding, yachting, motorbikes, golf, travel and up to 6 weeks a year of personal development. When I read that, I thought, when do you sleep?
Vladan Hejnic
That's my dilemma. When I'm somewhere and I'm doing something, I start wondering if I should be somewhere else. Which alternates between my hobbies, work and family. So I'm still figuring it out. But for now, I'm managing what I can.
Martin Hurych
Of your currently successful companies, I have VIVnetworks, Targito and Contentiamo. Where are you at the moment?
Vladan Hejnic
I've been spending a lot of time in Target. And I'll be for a while. But I've got a smart enough team there to take over some of the activities from me. I'm going back to VIVnetworks again to help with some big clients, some development, some expansion abroad.
Martin Hurych
Can you give us a brief introduction to the companies so we have an idea of what you do?
Vladan Hejnic
Sure, I'd love to. Since 2009, we have introduced the VIVnetworks brand, which is an affiliate network. For many years it has been the leader in Central and Eastern Europe in number of clients, size of clients, reach. Affiliate marketing, very simply explained, is commission advertising, we connect medium and large e-shops with content creators who, when they promote a product, there is a link at the end: you can buy here. And these partners within our affiliate network, this is how they get the visitor, for example, to Mall or to Karcher. And when the visitor buys here, the content creator gets a predetermined commission. It's commission-based online advertising.
The second company, Targito, is a data-driven company that automates marketing channels based on data, primarily email, but also texting, Facebook, and web personalization. It also focuses on mid-sized clients because they tend to have the most data. Based on the data, hypotheses are set and then automated to bring benefits and it helps the companies especially in communicating with their customers so that they look forward to communicating with our client. This is our ultimate goal.
And the third company, Contentiamo, came out of the affiliate business. There are many content creators, but there are specific groups, for example, influencers are a special tribe. For those, Contentiamo has created a platform where they can simply use links to recommend different brands or products. We also have links for professional reviewers, for example, so Contentiamo is doing more brand building through social networks, launching new products to make them known to their audience through social networks, for example.
Martin Hurych
Do I understand correctly that you are actually creating a platform or an ecosystem for your clients within which they can interact with the world?
Vladan Hejnic
I admit that we don't have such an ambition, because we still keep the three companies quite separate. So far, I would say it's paying off a lot. We always identify a space in the market, an opportunity, and we prefer to build a separate team with separate economics, our own brand and create a de facto specialist in that area. With the focus, when we're first in, we're able to be number one in that industry. So, for us to create a platform that will do automated communication through email, texting, Facebook, etc., and still do commission advertising on top of that, no.
Martin Hurych
Does that mean that if a Targita salesperson makes a deal somewhere and we're like, you're extremely successful right now and you're not even implementing, I'm not going to get a salesperson from VIVnetworks or Contentiamo into the company the next day?
Vladan Hejnic
You won't get it because we need to get credibility first in the context of what we are doing with the client. Once we see that it's a good path, only then can we also recommend someone to help them again with another area.
Martin Hurych
I've seen all your companies grow, which one are you actually most happy with now, or where are you best?
Vladan Hejnic
Well, you got me, because those companies are really very different. Simply put, VIVnetworks does affiliate marketing. And there, when I go to a client, I'll ask them how they work, how they spend their money, they spend a lot of times really heavily on Google, on Sklik, on Facebook, and I'll ask them if they'd rather not have that spend be directly proportional to the bottom line, and have the incentive to spend be on the other side. And there's just a question of whether he has affiliate marketing or not. If he has something, it's usually very easy to convince him that we're a whole different level, and if you want to take it to another level, there's an opportunity.
With the automated marketing platform at Targita, it's more complicated in that there are also a lot of technological hurdles to get consistent data from the client that we then work with. It's more sophisticated in that respect, there's more creativity in the technical part of it, which brings a lot of problems. So that's why at Target we focus on larger companies than VIVnetworks. VIVnetworks can help companies that have around 50-80 thousand monthly users on the web, for example a medium - smaller e-shop, but in Targit we need a company that has a turnover of, for example, 150 - 200 million.
How does affiliate marketing work in the Czech Republic and Slovakia?
Martin Hurych
As I follow affiliate marketing, especially the Anglo-American scene, it's been alive there for a long time, even people like me have some affiliates on their sites. Here, it's still a little bit unknown. Younger people are obviously connecting with it, influencers especially, but my generation still sees it as a non-standard tool. How do you see it?
Vladan Hejnic
Exactly the same. When we talked about the branding, that's the challenge, that at VIVnetworks we need to promote the industry as a whole, in addition to the brand. In the west, as you mentioned, affiliate marketing is a standard channel. When a client comes to us from abroad, they want affiliate marketing because they have it everywhere else and they know it works. Here it's more about explaining to those entrepreneurs, e-commerce managers, performance managers, how to work with it and explain the differences.
For example, all PPC systems, be it Google, List, have the financial power to educate agencies to prefer this angle of working with online marketing, but no one is doing the same on an affiliate marketing basis. We're not big enough to spend like Google or Sklik and do educational webinars, conferences, etc. We do it, but it's still only on a small scale relative to them.
Martin Hurych
From what I see, affiliates are very much in the B2C market today. What about affiliate and B2B?
Vladan Hejnic
I haven't seen it work yet. This is because on the one hand there may be a great company, but unfortunately on the other hand there are no partners who can talk about the company and its services or products. The exceptions in the West are all legal services, dentists, which is almost B2C, but it's a more complex product, it's a service. You can't touch it, golf club memberships etc , there they know how to find partners nowadays and explain to them to promote them and the business works. But in our country, unfortunately, it has never worked.
Martin Hurych
If I brutally simplified it to say that affiliate is actually in more of a referral giving or brokering business, would I be too wrong?
Vladan Hejnic
You'd probably be wrong, because there are at least five categories of those partners, what they do, how they work with the visitor when they send them to that e-store. What you didn't mention is someone who does catalogs. The big problem for a lot of e-tailers is that they don't catalog or categorize their products well in terms of search. It's much better now, but it used to be, for example, in terms of shoes, you have different colors, sizes, but at the same time, if you're selling other products that don't have a size or color, that search system is technically very hard to do. Then you get catalogues that are focused only on fashion, shoes, handbags, or similar products. And these then bring together the offerings of all those e-shops, and maybe that particular search is much better for the user there.
How to innovate and stay on top of the competition
Martin Hurych
So now away from affiliate marketing for a moment, it struck me that YOU are the soul of an innovator. Even in other podcasts that you've appeared on, you've said that you like to keep an eye on what the competition is doing, where the western world is going, or generally what's going on around you. How do you stay on top, how do you read the market, what's going to be happening here in a year or two, three, five?
Vladan Hejnic
To have some role models, to look not only at role models like us, but to look at their clients, because usually that's where you see the result, you look at who's doing it for them, and you see what interesting things that company has come up with within that technology. I have to admit that quite often the inspiration comes from our clients. We've built the Targito community around Targito, which is our customers presenting what they're doing, what they're good at, and it doesn't have to be directly related to marketing automation, they have the opportunity to give us tips on what they want within their business, because they're also watching their competitors, they're seeing innovative companies abroad, they're evolving, and they're giving us suggestions on what to improve or add. So innovation comes a lot from clients as well. And I think every technology company should acknowledge that, and also tell those clients that they are a source of inspiration for what to do next.
Martin Hurych
You have three companies, all of them growing by tens of percents, I'm intrigued that you're creating for a specific idea, I guess today you'd say a startup, right? How do you actually fund the start-up of a new project?
Vladan Hejnic
We're kind of oldschoolers, so we do it out of our own pocket. When we started the first company, we didn't see a penny of it for two years, instead we put family money in to pay the people who helped us build it, so the growth is always organic. It sounds flashy that we're growing by tens of percent, which we have been for a few years, but the whole industry is growing this fast, I would say we're the children of fortune. I was looking forward to a crisis sometime two years ago, because that's where we're going to see if our bet on that specialty and the industry within that e-commerce is a good one, I just didn't know that a crisis could come for biological reasons, I was thinking some kind of financial crisis. But really, even within the covid, you can see that business within e-commerce is flying up, whether you want it to or not, you'd have to be a downright dummy.
Financing a project or company
Martin Hurych
So when you open a new business or a new project, how quickly do you want to see his or her return. When do you want to see black numbers?
Vladan Hejnic
Today we are also making some acquisitions into companies that are similar to us and complement us in some ways, so I am looking more at the synergies today, but the golden rule is: two years. After two years, you can see if it works or not, but if you have the focus and you're committed to it.
Martin Hurych
So two years, and the company should be in the black.
Vladan Hejnic
Yes, yes.
Martin Hurych
That means you put up some initial deposit, and after two years the company has to fend for itself. Doesn't that put you at a disadvantage against a lot of the startups that get started here with outside funding?
Vladan Hejnic
I'm sure it is. I would like the market to clearly say, this is a startup, this has this strategy, and this is a company that has a different strategy. We, by not being a startup, by not having external funding, we don't have that push for those short or medium term goals. I'm certainly not counting on wanting to sell these companies in three years. So my decisions are five years ahead, even in relation to clients. It's about how I'm hiring people, for what money, and I would love and fight for there to be more honesty, and I believe that there are firms like customers who are and who are not willing to take the risk of going to a startup with their transactional data, and that may not be here in a year.
Martin Hurych
When you start a company as an innovator, are you always part of that team?
Vladan Hejnic
Yes, I'm sure. That's the golden rule, you've got to go through it. Now we've invented a new technology for attribution within affiliate marketing or all channels. And I'm now calling every client with our affiliate manager to see how I'm doing, I've done my first fifteen calls, and I'm learning through that, asking them, how are you comfortable with it, what would you like to improve, is this cost to cover the technology fair, is that okay? So I think that's really basic.
Handover of the company or project to management
Martin Hurych
You can't be everywhere at the same time. When is it time for a founder, or owner, or CEO to step back from the day-to-day business, find a management pro, and focus on the next project or strategic planning over a group of companies?
Vladan Hejnic
For me, it's the moment the company makes money off those people. My colleague and I realised after our first two years at VIVnetworks that we had to start paying ourselves a fair wage because we were putting pressure on ourselves. As they say, the rule is: pay yourself first and then pay others, and it really works. It creates a backdrop so that you can then hire that pro and give them your wage, freeing up your hands to do something else. And then it's also a situation where we started out primarily with juniors because we didn't have the money for the pros, the senior people, then you balance the quality of the work, how you would like the firm to work with the clients, and that's directly proportional to the juniority or the seniority of those people. So there's always pressure to give that money back, you've replaced a junior with a senior or a senior-junior combination, and it costs you more and more money, but it's worth it because the quality of the firm goes up. And I guarantee the money will always come back.
Martin Hurych
Great point. Put your salary on the balance sheet immediately because I know a lot of entrepreneurs who feel like the company is fine, healthy, but then you find out they don't make a penny. Junior versus senior, you don't tend to bring up junior then?
Vladan Hejnic
It's not exactly. I'm looking for the right combination, which is what we've done in hiring, for example. But the junior has to have the disposition, the ability to continue to develop so that I can make him at least a mid-senior within a year. So we nurture them, but sometimes we have to take a senior from another field who has some good habits that we can transfer to us, it will enrich us, but we have to teach them our specialty.
Martin Hurych
How do you select the senior to whom you will then hand over the project or company? How do I gain your trust so that you are willing to go on to develop something else?
Vladan Hejnic
Most of the time it was some kind of coincidence, these people were recommended to me, I asked for recommendations. Subsequently, I would meet those people, but I still need to be in tandem with that person for at least a year, see them at work, set up a close relationship with them, and teach them my own thinking so they can solve things the same way I do without me.
Martin Hurych
That is, these people won't come from the free labor market?
Vladan Hejnic
No, for example, my last colleague worked for PPF for 13 years, mostly abroad, and because of his family he wanted to come back and not just work for someone else, but have something of his own. So we have designed and option programs, a few things came together and he was recommended to me.
How important is the team and how to choose it?
Martin Hurych
How important is the team you have in your company to you?
Vladan Hejnic
Today, absolutely. I used to think the idea was the alpha and omega for me, but I've come to understand that the execution is much more important. But with hindsight, I'm finding that in order to help more clients, I can't just lock myself into that execution and do it myself, so that team is essential. You can have the best idea, the brand, but if that team isn't of the same DNA as you, you can't convey that to them, they don't live it, and the output is half.
Martin Hurych
I had a similar realization. Is this knowledge with age, or is it that you just have so many activities that you can't keep up with them anymore, so you're partly forced to rely on those people?
Vladan Hejnic
I can only talk about my personal case. I don't know if it's a rule, I can imagine great people who get it at 30, they can meet someone they trust and soak up that knowledge from them earlier. I didn't have a role model, I learned everything by trial and error, so I didn't figure it out until I was 40.
Martin Hurych
That's still relatively early, I know people who I don't think will come to that realization until retirement. How do you select people with the right DNA, or how do you even let people know what your company's DNA is?
Vladan Hejnic
It has to do with brand building, which we are now starting to do. In order for the brand to reach the market and to work with it, and for people who share the same values to come to us, it is necessary to be able to let them know. We need to define how we look at different things, ethics in business, which is actually the reverse of a startup defining what they want to be.
We have a more complicated hiring process. At the beginning we have a junior person who searches for tips on LinkedIn, in articles, who has been successful in what, etc., and then a more senior person starts to communicate with him in the sense of: how interested would you be in this field, do you think it is promising? And at the end of that communication is the question: would you like to know about someone who is successful in that field? For example, out of 70 people, only 10 people drop out who are even interested in talking further. It also varies with the market, whether people want to change jobs or not.
Martin Hurych
So you don't say at the beginning what company you're looking for?
Vladan Hejnic
I don't, but the colleagues who help me, they rather start to have a discussion at the beginning to see if the person is willing to change, there are also people who are great in their field but don't want to change. What helps us is when they say they are interested in getting an offer, that's when we say, okay, but first we need to get to know each other more, if you wouldn't mind, please fill out a questionnaire, a test. For me, vascas.cz has been very useful, which is about 200 questions about how you see yourself in different situations, and from that you can trace in twelve areas, if you can start ideas, if you can execute, if you can finish, if you can build relationships, if you maybe cling to your truths and are not willing to change them, etc. It's not a show stopper for us, but when the person gets up close and personal with me, I use it to ask them about some situations, how they handle them, what they did last time, etc. A lot of times the candidate even asks how he turned out, we discuss what he's great at, and what's important to consider, like if he's going to be working on a team in the future, I have to say: you have to watch out for this, because otherwise the team won't work with you. And it's up to you to decide if you want to go for it or not.
Martin Hurych
Do you check every new employee?
Vladan Hejnic
Yes, definitely, because it's important for me to explain to him who we are, how we think, and to make him really think about whether he wants to come to us.
Martin Hurych
You said the importance of the brand. On the other hand, in the recruitment process, if I understand correctly, you would only declassify the brand at some point in the third step anyway?
Vladan Hejnic
We do that now because the brands are not world famous. If we had a great acquisition process it would be almost automatic that people would send us CVs, but I don't have the process set up that way, so we have it that way because maybe we're not doing well in an area.
Martin Hurych
So for you, the brand is also important in some employer branding, or whatever it's called nowadays.
Vladan Hejnic
I understand this term to mean that especially the people who work for us are proud of what they do, who they work with, and that they work in VIVnetworks, in Targit or in Contentiam, and they can somehow spread it around. I'll tell a funny story from a colleague: you guys have made my life pretty complicated, because now when I sit down with someone at the bar and tell them all the great work I do, I see how many times their life and work is relatively boring, which also makes me stand out from that group. So then that can make for some relational social problems.
Why is brand important?
Martin Hurych
You are now facing a challenge: to build, to dust off, to redefine the brand. Why is this important to you, besides the hiring?
Vladan Hejnic
For example, at Target we run into this a lot because when we want to do anything in marketing and we don't have it anchored in some way, especially in marketing people are typically creative, we have a lot of discussions that we waste energy and time on, whether it should be with this font or that font. But if you had a brandbook where the font is clear, you've got it with some logic, you don't spend that time on it.
Martin Hurych
I'm intrigued by this. I know people who build brands, and I would guess they wouldn't agree much with the idea that brand equals design guidelines. So what do you think you should look like? What should the brand carry into the world?
Vladan Hejnic
VIVnetworks should define transparency in our business, in affiliate marketing. We have such perfect technology that we can afford to do that, and that's a big advantage over the competition. And the other tagline, we have clients in 27 countries. We're physically in 6 of those countries, and we have native speakers for all of those countries. Therefore, many even international competitors cannot compete with us that much when the Czech market is controlled by a German from Hamburg, and he does things the way they are done in Germany. So market knowledge and native speakers.
Martin Hurych
27 countries, which region do you have under your thumb, so to speak?
Vladan Hejnic
In order: the Czech Republic, Slovakia, Poland, Hungary, Germany, Ukraine, the ex-Yugoslav countries, where we are investing a lot now, Romania.
Martin Hurych
And the former Soviet Union.
Vladan Hejnic
The Soviet Union, but Germany, France, England are very important for us.
Martin Hurych
What are your three most important points to accomplish by the end of the year?
Vladan Hejnic
Definitely to move Targito to be very independent, I'm working on that a lot now, to get VIVnetworks into a bigger awareness of our clients so that we can do more for them, because there is a huge potential there, and in Contentiam to connect some collaborations with reviewers, like Test it and so on, to expand the type of product, services so that I can offer a bigger variety to the client. Those are probably the three streams that we're working on intensively until the end of the year.
Martin Hurych
Share with us at the end something that you have done really well, something that people should follow you in, or something that you are still scratching your head for today? Would you pick a highlight, what would it be?
Vladan Hejnic
The negative, what happens to everybody, which is to be able to say goodbye to some collaborations, to some people in time. There's no need to say why we can't do that. Maybe we all keep believing that it's going to get better... so I guess we always set it up well and go to some KPIs, and they show the truth a lot.
On the positive side, it depends a lot on the people, because I would say it's often mainly their success, at least in our companies, because the executive is already very much on their side. The fact that these people really live the company, I don't have to worry and be worried that we won't be here in a year, in two, in three. If, God forbid, something were to happen to us owners, I believe that culture will hold them together. And I think they've also learned over time how we make decisions so they can make very similar decisions.
Martin Hurych
So this is your cigar phase?
Vladan Hejnic
You know the cigar phase doesn't exist. That, that's a big mistake, and you if you don't educate yourself and keep thinking, you just die, you don't grow like the market, so you get ripped off, and you start to expire. I'm interested in longevity. When I was looking at some American study that kept these centenarian people alive, healthy, even when they were drinking whiskey, smoking cigars, they always had regular mental activity, and often physical activity. I say I'm not retiring. And it's purely a matter of spreading your energies. I'm a fan of collecting a mini-retirement.
Martin Hurych
So instead of a cigar, we'll see you somewhere sparking up some other project?
Vladan Hejnic
I'm sure.
Martin Hurych
I'll keep my fingers crossed.
Vladan Hejnic
Thank you very much.
Martin Hurych
That was Vladan Hejnic, if this episode sparked your interest, whether for email marketing, influencer marketing or affiliate marketing, we'd love it, be sure to tune in for more episodes on YouTube or your favorite podcast app. Be sure to also check out my website www.martinhurych.com for more free accelerator tools. Fingers crossed and best wishes for success.
(edited and shortened; automatically translated by DeepL)