"Put together relevant contacts and validate their existence. Don't chase quantity. Quality is better than quantity.And choose a multi-channel approach. One email usually won't make a difference."
He started by finding relevant leads for the company. In a small team of 4 associates. But he wasn't enjoying it. So thanks to a friend, he got a program that made his job easier.
Cleverness or laziness, take your pick, paid off for him. He found that companies were willing to pay for this idea and program. So much so, in fact, that he built his own startup on finding and reaching out to leads. And he took it all the way to becoming the 16th fastest growing company in Central and Eastern Europe according to Deloitte.
This is how "simply" Vlastimil Vodička got to his own company Leadspicker.
And because he is good at addressing companies with cold emails (otherwise he wouldn't have got the award, right?), I invited him to Zážeh to share his know-how with us. What did I ask?
🔸 What are the most common mistakes in sending cold emails?
🔸 How to automate cold email personalization with AI?
🔸 Where to find valid contact databases?
🔸 What language to address in?
🔸 What can be considered a successful campaign?
TRANSCRIPT OF THE INTERVIEW
Martin Hurych
Hello. I'm Martin Hurych and this is Zahžeh. Today's Ignition will be about business again and whether or not cold emails work. For this topic I have invited one of the most knowledgeable people, Vlastimil Vodicka, founder and CEO of the startup Leadspicker. Hi.
Vlastimil Vodička
Hi, Martin. Thank you for inviting me.
What is he resting with?
Martin Hurych
You're welcome. I am known for preparation and in yours I was struck right from the start by two things that are quite far apart for me personally, judo and flying. Which do you get more rest at?
Vlastimil Vodička
That's a great warm-up question. You definitely warm up more in judo, and I think it's also more similar to business because it depends on how you train at home. Then when you go to the fight, there's no one there to help you, it just depends on how you've prepared up to that point. Flying is pretty new to me, my dad is ex-military, he flew in a helicopter for a long time, so I'm just poking around and hopefully soon I'll be able to fly myself. I'm going to relax more with the judo, because as there's sometimes the wrestling, the choking, so there if you don't pay it off you can relax quite quickly.
Martin Hurych
My dad flies whirligigs too, it's such a strange plane.
Vlastimil Vodička
That's right. It looks like a helicopter, but it's a plane and to make it even more interesting, my father has the first flying car in the Czech Republic. He has mounted electric motors on this whirligig, which can fly basically anywhere in Europe, or even around the world if you take it by boat, and he drives it on the road. It comes out of the garage at home, they look at it as the biggest attraction there, it goes across the village to a field where there's a former agricultural airfield, takes the propeller off, spins it up and flies.
What led him to found Leadspicker?
Martin Hurych
That's awesome. Let's get back to you and the company. How did you get into this and what does Leadspicker do?
Vlastimil Vodička
I got to this point by manually searching for companies and tracking down contacts. I felt like I was doing the same thing over and over again, so I approached my childhood friend to see if I could automate it. He was kind of the smartest kid in the class who had programmed a game in third grade. He said it could be done, so he tried it, and we did the first version at the time, which was still a desktop version, a little window where you uploaded pages and it pulled up contacts. It was quite functional for the time, and I found that I could suddenly do the work that we were doing with four people on my own. The company found that out too, I was working in Vienna and the second year I was there, it was just me, they didn't need any more people. At the same time, I got an offer to work in an investment fund, J&T Ventures, so I moved back to the Czech Republic. I made a deal with the original company because it was of value to me that we would deliver as a company. We called ourselves Leadspicker because we were collecting leads, and that's how we got our first client. Then we basically said if it makes sense for one company, I'll try to reach out to a second, third company, and so we kind of spread out client by client, invoice by invoice in the beginning.
What he did at J&T Ventures
Martin Hurych
One thing I don't know if I got right. Did I understand that at J&T you were scouting for scouts, or were you actually already writing a startup scouting program at J&T?
Vlastimil Vodička
When I started there, I was primarily looking for startups. Anyway, it was 2015, so there weren't that many investment funds out there yet, and there were three of us at J&T Venture, so I was able to get my hands on everything from the very beginning. It was investing in the first companies through follow-on investments, portfolio management to the first divestments where we sold a couple of companies, so we proved that we can make money, not just spend it, to the founders of the second fund. That was kind of my journey, where I got to experience everything in the lifetime of that fund.
What was different when you founded your own startup?
Martin Hurych
There was one thing that really stood out to me. You were looking for startups to invest in, which means you saw a lot of them. What surprised you or what was different when you started your own startup?
Vlastimil Vodička
That's a great question, because everything is different. It always seems like from the table, I take the money, I put the ad, I recruit the AI guys, I tell them what to do, I study what the UX and UI should look like, I explain it to them, and it just kind of works out. I'll recruit salespeople, I've read up great on how to manage the sales team, how to motivate them, what bonuses to give them and it'll all work. Then all of these ideas fail because they meet a reality that you couldn't quite imagine before. So I think the combination of knowing both sides of that is very interesting. I think I went about it a little bit the other way around, because usually a lot of successful people see money somewhere first and then think about investing it. I basically jumped right into the investment world almost right out of college, and from there I decided to move to a different chair afterwards and try it for myself. I think the perspective from both sides is definitely interesting because one side doesn't quite understand the other side in my opinion and conversely the founders don't understand how those investors need to make money and those expectations are different. I have to take into account that the investor is in the company for a certain period of time where they need to make money and they need to be able to leave the company.
What are the most common mistakes in sending cold emails?
Martin Hurych
I've had a few companies coming around me lately, some of them are my clients, that want to expand, want to go abroad and feel that cold emailing or email outreach is the way to go. So they hire someone to help them with that, they pick a database, they run a campaign, and after six months, after reaching out to often higher thousands or lower tens of thousands of email addresses, they get units of appointments. The result of all this is a bit of a bitter taste in the mouth, because it's not a cheap affair and it doesn't bring anything, according to them. On the other hand, I see, for example, as I pick up new technologies, that the companies dealing with this are growing like mushrooms after rain. The ones that do lead gen and the tool providers. It all clicked for me when I read about you that you were the 16th fastest growing company in Central and Eastern Europe at one time according to Deloitte and it dawned on me that you grew up on exactly that. You provide this service and tool yourself. Where do you think the buried mistakes are, that on the one hand you grow, companies see great potential in it, but on the other hand in practical deployment a lot of people have rather negative experiences with it?
Vlastimil Vodička
I think it's about the fact that there's a lot of things that affect that overall outcome. It's very easy to get each of the parts wrong, and it affects not only the actual outcome of that one campaign, but it will also affect the outcome of all subsequent campaigns because the domain will get a bad reputation. To make the thing work, you need to put together three such major components. One component is having the right data in the first place. A lot of people think that the more I reach out, the better the result. Believe me, reaching out to 30 good companies where I know exactly what they want, it's really relevant, and the person I'm reaching out to is exactly the person at that company that's interested in it in the first place is better than having a database of a thousand companies and reaching out to everybody. So one part of it is having a list at all, which you need to really prepare in detail. I can't just find a list of companies somewhere and go around. That's the first stumbling block. Also, it's important that those people are still working there. The second part is the content you send. Would you respond to that message if it came to you like that? Usually the message is long, so people just close it because they're too lazy to even read it and it doesn't look human. Plus, the vast majority of those messages are about them. It really works more when the report is slow at three sentences and is purely about the other party. There are even interesting tools today that can accurately measure the difference between how many times it's talking about me and you. In the past, that might have worked, but as more and more of it is out there, it just doesn't work as much, and at the same time, we're talking about the fact that there's some content in that message. People were used to us selling this, this, this, and you might find it all useful, so I'll put it in that email and you pick and choose. Except the person just doesn't read it, so the content and what works changes every few months. The absolute worst thing you can do is Google the top 10 best templates to write cold emails and start sending those.
Martin Hurych
Before we get to the other reasons, how do you find out, for example, what's already working or what's not working and what's the current blockbuster in outreach?
Vlastimil Vodička
It's terribly simple, you can see it in the number of responses. That's what's really most important in the end. Then you see it in the metrics, how many people opened it, how many people clicked on it, and so on.
Martin Hurych
I understand that, however, no client wants to hear that they have just been a guinea pig for something that no longer works. So how do you fine-tune what you're going to use in a new campaign?
Vlastimil Vodička
There are always more than one variant being prepared and that variant is based on something that I think is the best, some best practice. Then when we see that it doesn't have the same results, we find out what's going on. You mentioned at the beginning that the development of these tools is huge. Just here in Prague we have the development of Outreach, Unicorn, which is an emailing tool and a billion-dollar valuation. There's quite a lot going on here.
How to find out what outreach works and what doesn't work anymore?
Martin Hurych
So how do you track what's working or not working so you don't send out a campaign and then tell the client it didn't work anymore? Because then you don't get another chance to send another email, I suppose.
Vlastimil Vodička
We don't send large quantities, so there's always room to test it on a smaller sample. Rather then find that new and new things are being developed that are starting to work better than what it's not working. Yesterday, GPT-4 was launched, which again pushes the envelope of what AI can do today. For example, a year ago, we used students to look up a sentence for every leadoff, to make it really personal. To really look at that website, that LinkedIn, and see what the customer's problem is and write it in two sentences so we can use it in that email. Today, artificial intelligence can do that for you, and it can do it not only just as well, but consistently. The problem with those people is consistency, because try doing that for like 10 hours straight, you're not going to keep their attention.
How to automate cold email personalization with AI?
Martin Hurych
Let's stop there. Come on, give us a tip or a hint on how to use the tools for this. You said for 30 emails, I probably don't need automation, that can be handled manually, but if I'm going to have 300, 500, 1,000 into some big market, it may still be a small database, I still need to personalize it in some way. How do you do that, for example?
Vlastimil Vodička
If we want to use that Chat GPT, the technology that powers it can be very easily connected to Google Spreadsheet. I can give you a link afterwards with a full proposal on how to link it, it's easy. You then have an excel spreadsheet, you've got all these leads set up in there, and if you have a label next to them or what the company does, you're able to tell it what you want to do based on a simple function. It's good to test that first somewhere on the side on a smaller sample. For example, we have the whole about page of that lead copied in and based on that, the AI decides what would be a good thing to add to the sentence. You test that, you find out that the first, second, third and fourth options don't sound good, but for example the fifth, sixth and tenth ones sound great. Then you just stretch it out over all x leads and it doesn't sound too bad. It's so interesting how you can work with the AI because it can sum things up nicely, it can add to a sentence, it can change the way it looks at a given thing and so on.
How to prepare the infrastructure for distribution?
Martin Hurych
If I remember correctly, we have database validity, we have people in the database who actually exist, we have some novel personalized outreach. What else do I need to make it all work in the end?
Vlastimil Vodička
It is good to have some infrastructure. What you can start with are tools to help build the reputation of that domain. We basically with every client, when we start a new campaign, we find that maybe the domain they're sending it for has already had its reputation affected by what's happened in the past. They were sending a newsletter to thousands of people where not everybody was maybe a client and so on. We're creating a new domain, which I recommend everybody do on purely this thing that's not affected by anything else that's going on in that company. We're warming that up, a good tool for that is Warmup Inbox, or Lemwarm, which what it does is it takes that email of yours and two weeks before you even want to start a campaign, it sends out from that email to a network of other emails. It's good that it builds up some reputation that you're getting some quantity of emails going out there, responding to them, and then you can build on that. Then when you look at, for example, the deliverability, you know that if it's bad by you, but it's not because someone somewhere in the company sent something and you didn't even know about it. Based on that, you can edit the message, how it should look or its subject line.
Martin Hurych
If someone wants to try doing it themselves, since you named Outreach and other tools, there's nothing stopping me from buying it all and trying to implement it tomorrow?
Vlastimil Vodička
Everything that companies like us do, you can build yourself. The tools are there, you can build it, it's just that you have to dedicate yourself to it and you have to test what works.
Why choose a special domain for communication?
Martin Hurych
Do I understand correctly that I shouldn't touch my own domain just in case I lose it if something goes wrong?
Vlastimil Vodička
You can't lose it, but the domain should be for communication with your clients who know you, where there has been some communication. However, you want to reach someone in the B2B company who hasn't heard of you and you sell ICT security solutions. You see, there's one person in this company right here who has the job title ICT security manager and has in his description that he's into this stuff. So if you want to approach him, it will work better from that new domain than if you approach him with a bad reputation.
Where to find valid contact databases?
Martin Hurych
When I have all this ready, what I observe with my clients, or even generally with friends I talk to about it, the biggest problem is to get the database at all. Most of the time you can get something somewhere, the question is what. Like where do you think to look for valid sources? I have a clearly defined target, I'm looking for a partner for a software tool that I want to sell abroad, so very likely it will be the CTO of the counterparty. Where and how to get a valid database?
Vlastimil Vodička
I would divide the database into two levels. It's not exactly a problem to get a database of companies. We also buy a lot of things, that's not a problem at all. The problem is that the people in those companies have not been in Japan all their lives, so it changes over time, people change jobs or change companies completely, and it's almost impossible to keep the database up to date. The best companies in the world, the ones with the most value like ZoomInfo, are able to keep their database up to date about once every 9 months. Keeping hundreds of millions of companies and all their employees up to date is difficult. What we do and what is such a best practice is that at the company level it's not a problem at all to buy a database, there are a lot of providers even Czech ones for B2B companies. What then tends to be a problem is that you have to track down those specific people in those companies who are working there now. There are two great resources that we use. One great resource is LinkedIn and for people who are not on LinkedIn, Google Search engine works. We do things the way a human would. He types in the name of his company, Jan Novak, into Google, some results come up, and very often it's LinkedIn. That's the way we do it, and we are able to tell immediately from LinkedIn if someone has come to another company. We're actually hacking Google Search. When we prepare our databases, we don't have
no fake profiles or anything that's picking up on LinkedIn. We, on the other hand, work with Google, Bing, Yandex results that scrape that LinkedIn, and that's what we work with. It's publicly available information because actually everything that gets indexed on those search engines is normally accessible and we work with that. So we go at it from the outside like this.
Can we rely purely on AI?
Martin Hurych
Listening to you, I was thinking one thing. Google is working vehemently on this, text identifiers are appearing that are written by artificial intelligence to remove that artificiality or impersonality. So how does GPT text go through these tools that we've been talking about?
Vlastimil Vodička
We haven't tried the short message yet because I don't think it's possible for the machine to generate the whole thing for you. We use a tool called Regie.ai that can build and optimize the whole sequence for us, and the results we get are not straightforward to use, but it's a cool muster that you can still tweak to your liking. I don't think the AI is going to replace the human writing it. It's more about helping him do more variations, telling him what's wrong and helping him think about it.
How are the mentioned tools in Czech?
Martin Hurych
Most of the tools that are great in English are lacking in Czech. How is it here?
Vlastimil Vodička
A few months ago, we would have thought that it wouldn't work in Czech for a long time. But then suddenly you see how it's shifted in just a few months. For example, a few months ago we were using Regie.ai to prepare things in English, and then we used another tool, DeepL, for translations. Then GPT Chat came along and we found that the English sounds much better again, and maybe when we finish this podcast and try out how GPT-4 works, we'll find that it's even a little bit better. So this is getting better and I believe that soon it won't be a problem at all.
Martin Hurych
A tip for people who write emails in English, when you mentioned DeepL Translator, DeepL Write is great, and it can write a C-level email in German and English from B1 and a native speaker won't know it's been transcribed.
Vlastimil Vodička
I'm ordering something in Germany right now and I think it would look different without the translator.
What language to address in?
Martin Hurych
I want to go abroad, right now we have just discussed France a lot. Should I communicate in English or fixate that I know French?
Vlastimil Vodička
Good question. We can say and subscribe to the fact that localizing the message into local languages always works better, even if the other party speaks English. It's best to have somebody who can answer in French, communicate in French. When we do these campaigns, we write them in that French, and all it takes is for someone to look at it, it makes sense. Even if you don't have anyone in the company to speak French, we've found that it's better to write it in French and leave a short note at the end that if they're interested, I'll put them in touch with a colleague. They'll already know from the name that it's not French. Or we could just write that any other meeting would be in English, that not everybody there can speak, or that the colleague there doesn't speak French. That kind of thing works too, but anyway the localization works much better in all languages.
What can be considered a successful campaign?
Martin Hurych
So I have a good domain, I have a good database, I have a good local language addressing, I'll run it. How do I actually know it's a success? You said at the beginning that you're tracking different open rats, click through rats and so on. What should I be targeting, what's achievable?
Vlastimil Vodička
Success is when there are clients and there is money in the account. Now I'll give some metrics that are good for us, like an open rate above 60%, that I get 20 positive responses out of 150, 200 companies that I've contacted, that they want to keep talking. Then I'll get 30 to 40 that maybe they're interested, but the person at that firm isn't quite up to date and they'll link us to a colleague. From that, my experience is that maybe another third can be turned into just those meetings. But this can be misleading, because it can also be a completely successful campaign, there are an awful lot of rallies, but they don't turn into real business. Then I find out that we've targeted the wrong people, who maybe don't have the budget for it, but they're interested. That's actually even worse when you're stressing out your sales team and their capacity by having a meeting with someone who would never buy it. So the best metric is if it actually turns into a business. But that business cycle is some time and we're also not able to hypnotize that prospect into buying it, so maybe we measure how many offers at least fell through and moved on from that meeting. We are trying to somehow make it to the 20 positive responses out of 150 companies contacted. But don't think of it as one email to one company. It's a sequence where I have singled out maybe two people who are the most relevant, and the first week the message goes to one, then there's some follow-up, and the best way to add to that is maybe LinkedIn. Think of it this way, most of the people you approach, even though they are interested, are not ready to talk to you about it right now, or to buy. So there needs to be not just email or LinkedIn involved, but all marketing in general. That means they might click but they don't respond, they're not interested, but they should already know about it from you, they should have seen some other content. You need to work with them within that marketing funnel for a longer period of time because I've read this analysis now that only 3% of the people that you reach out to are the ones that respond right away and you have a meeting with them. Then the other 7% are the people who have that need, they're interested, but it's not a priority right now, and that often includes me. I try all the new sales tools, something always jumps out at me and I want to know more. I'll reply that I might be interested, but then I'll start to deal with something else that's more urgent that day and somehow it gets lost in the annals of email history. If I don't get reminded, which could be anywhere, something might pop up on the internet, I can see the content, I forget about it. So the 10% of the people in that whole are the ones who really have the need and the timing is now. Then there are about 30% of people where it is also relevant but they don't even know they have the need yet. There, it's more of a task for marketing to raise that awareness that they could use something like this.
How often and how many times can I be reminded?
Martin Hurych
There were two things that stood out to me. First, it's good to remember that this is a multichannel approach, because one email won't cut it. The second thing that occurred to me with this, quite often I get asked how many times and when I can remind them anymore. How do you have that in your country and what are the cultural differences? Because I suspect there are regions where I can afford more than somewhere else.
Vlastimil Vodička
That's right. I'll answer the first part first. The outbound is the fastest way to get to a new customer who hasn't heard of you. When you know who those specific people are in those specific businesses that it's relevant to, that's the fastest way to get to them. It's kind of the kick-off of the whole campaign. But you have to take into account that most people aren't going to buy it right away, even though it's relevant. That's where the marketing should follow up. They say that the client should see you seven times before they buy. That means they get an email once, they saw something on LinkedIn once, they saw something online somewhere, then maybe they heard a podcast, there's a lot of things. When you get an email from someone you've never heard of, it doesn't really get you out of your chair, but then when you see more than that, it already establishes credibility. On the second question, I'm sure there are different practices in other regions. I think America, for example, is further along in this, and there is a certain blindness that plays a role. There, you don't just get one email answered because they start to become much more relevant, tailored, and you need to be seen at least ten times. Here in Europe, I think by the third email people will be wondering why you're choosing them. That's definitely something that needs to be taken into account.
Martin Hurych
I've seen a statistic somewhere that by the sixth email you get over half of the responses you request.
Vlastimil Vodička
I don't know if that statistic took into account emails for the company or for that particular person. I don't think writing six times to one person is quite right, but if a company has dozens or hundreds of employees, 6 messages over time is fine. I don't get a response from person number A to my second email, so I write to person number B mentioning that we tried to contact person number A and then maybe I'll get that response. Bottom-up, bottom-up, or vice versa approaches often still work there. I'll give an example. You sell an accounting system and the user is an accountant, for example. If you write to the accountant to try something new, who's used to Cool all her life, you not only scare her off, but she definitely won't answer you because she's not used to being written to. If you write to the CFO asking him to try something new here, he might reply, but usually he doesn't have time and everyone writes to him. That's why it works much better if you know who you want to get to, like the chief accountant, who is going to be the user, who is able to even assess how your accounting system is better. But you don't write to her directly, you write to that supervisor, maybe that CFO, but you don't want anything from that supervisor. You write that you're trying to get in touch with a particular person who is in charge of these particular things and just ask if they could forward it to them. Believe me, when an email comes in from the boss asking to look at it, they will look at it and respond.
Summary
Martin Hurych
If we were to somehow summarize this into 3, 5 points that we then put into a bonus guide on how to use and saddle Chat GPT, what would it be?
Vlastimil Vodička
I can add some presentation where I can add more points. But starting from the beginning, in terms of the database, the first thing that immediately improves the results is if you use some tool to see if those emails even still exist. For example, we recommend ZeroBounce, which isn't the cheapest, but we know it can discover emails that are working but the person is no longer working there. It's a good idea to clean up that database you got somewhere, verify that those emails are working, verify that those people are still working there. You can do a manual search through LinkedIn or use some other handy tool, like ours, to get that database ready. They should be relevant companies and those people should be working there. That's something that usually improves it right away, because if you have more than 5% of broken emails, that campaign is going to do terrible damage. The second thing is the amount you send. Often people think that the more I send, the more likely someone will write back. That's wrong. It's much easier, even if you have to do it by hand, to post by the dozens every day and the difference is much better. We're talking about cold emailing here, not a newsletter to a thousand of your clients who already know you, where it's perfectly fine to use some MailChimp and send it to everyone. But when you're reaching out to someone who doesn't know you yet, it's better to send less to companies where you've really sought out specific people than to send a large amount. We have calculated that the maximum you can send from one email is 50 messages per day, but it doesn't make sense to send that on weekends and Fridays. On the other hand, we have found that Sunday evening works well. So we send a maximum of 50 messages a day, and then you can increase that by maybe 10, 15% every week, and there are tools to help you chop it up like that.
Martin Hurych
Thank you very much. To summarize, you said you'd help us with Chat GPT, you said you'd send a presentation, and before we started you said you had some free access to your tool.
Vlastimil Vodička
It's true. We've done a lot of work with customer databases, and we've always found that the database that the client has in their CRM system or Excel is full of people who don't work there anymore. So we built a tool called Pipebooster that can look up if they have a linkedin profile based on their first name, last name, and the company where that person worked in the past. Basically, it works like a person who searches for that employee on Google, LinkedIn, and based on that, they can tell if that person is still working there or not. When he finds out that the person is already working somewhere else, he immediately starts looking for that new company, new contact, and we can also track down who replaced that person at the previous company. We've built a tool for that and listeners can try it out. We put enough credits in there for a Pro subscription, I think it's $118, so everybody can try it out for free and update their customer database. That way you can see which of those contacts aren't responding just because they're already working somewhere else, for example.
Martin Hurych
Thank you very much. I wish you the best, may you grow and may you appear in Deloitte again, this time as the fastest growing company in the region.
Vlastimil Vodička
Thank you very much, thank you for inviting me.
Martin Hurych
I hope that we have convinced you that when e-mail outreach is done right, it works, after all, today's guest is an example of that, because he grew up on it himself. If you're interested in this episode, be sure to like, share, subscribe. Be sure to check out my website, www.martinhurych.com, where there's a bonus under the Ignition section under this episode right now. All I can do is keep my fingers crossed and wish you success, thanks.