How Zapier got $575M in SEO traffic, AI data that will blow your mind, & Google AI Overviews decline

So Zapier gets $575 million worth of organic traffic. So you can run their traffic through Ahrefs, Semrush, or, you know, Ubersuggest, whatever you want to use. And so those of you that can't see the screen, go ahead.

Per month?

Per month? Yeah, per month. Per month, yeah. Yep. So if you look at what they're ranking for over here, you know, it says like 20 best Trello alternatives and competitors in 2024, 15 best Jira alternatives, Top 10 ServiceNow competitors and alternatives. And they just have a lot of these permutations, right? So you can look at the keyword, the top keyword these pages are ranking for. So ChatGPT alternative, Visio alternative, TeamViewer alternatives, Miro, ServiceNow competitors. The thing about Zapier, everyone should understand, if you don't know who they are, they basically help you. It's a no-code product that allows you to connect different software with each other. So for example, if I have a lead that comes into my website through WordPress, for example, It can push that lead into HubSpot. It can also push it into Slack without needing to know how to code. You can easily set it all up there in there. And they're adding a lot of cool AI features. And so they have, you know, all these integrations with all these products over here. And their strategy is just, okay, well, if we integrate with all these products, then let's just put in all these alternatives and competitors and then put in a recipe for everything. And that's how they get their $575 million worth of organic traffic. And it works well for them because As far as I know, they just raised that little, you know, for Y Combinator. I think at the time they were only doing like $50K checks or something. Um, and they take 7% of the company. And after that, they never raised money again.

And they just been on there. They raised money again.

Did they?

Yeah. Sequoia Capital put in a big chunk of money.

But this is like recent, very recent.

No, no, no. This wasn't recent.

Let's see. Let's see.

Sequoia Capital put in money, my guess, 2 years ago.

Yeah, that's recent.

That's not recent. Raising money in like 6 months is recent.

That is recent.

Okay.

Because they've been around for a very long time. When I say recent, they didn't raise for a very long time, right? But to your point, 2020. So you're right. So 2021, this is before they raised actually. I'm looking at Forbes right now. Zapier reached a $5 billion valuation at $140 million in recurring revenue despite raising just $1.3 million. And obviously that valuation has come down a lot since 2021, right? But Zapier fundraising Sequoia. Yeah. Sequoia buys shares in the elusive startup Zapier. This is in 2021. So that's what happened. You're correct.

At the $5 billion valuation. Yeah. That's where Forbes got it from.

Yep.

But here's the kicker with Zapier, right? If you had to guess how much revenue, and I think that money was money off the table. I don't think the company needed cash.

You're probably right on that too.

How much revenue do you think Zapier does?

A couple hundred million in ARR.

So $575 million worth a month in traffic, okay? Times it by 12, roughly $6.9-ish billion. Roughly $6.9, it's late for me. I'm doing math in my head. It's not probably great.

Yeah, it's 9:20 PM for Neil right now, right? 9:20?

It is 9:50, but yeah, close enough. So let's say $6.9 billion. It's crazy how a lot of these tools evaluate traffic and say it's worth so much, but yet, and I'm not saying Zapier's doing a bad job, I think they're doing a good job. It's crazy how it's hard for them to even make a half a billion dollars in ARR when they're getting a half a billion dollars worth of traffic per month or $6.9 billion per year, right? What is the value of the traffic? It's what someone's really willing to pay based on how they can monetize. But it's funny how people value traffic. And I went down this rabbit hole before too, because dude, we used to get SEO traffic for the most randomest terms, how to get more Instagram followers, what is Discord, like everything that you can imagine. And then there were some Twitter posts being like, Neil's traffic is down, he's losing at SEO. And little do they know, my revenue has more than doubled or tripled since that.

And everyone was celebrating, Traffic going down.

They're going down. And what we decided internally is to stop optimizing and creating content for these terms that were driving us traffic. And these calculators on Semrush, Ahrefs, even Ubersuggest, we're guilty of it as well, would say, look at how much value this traffic is and how much it's worth. Well, who cares how much it's worth? If it's not driving me any revenue, then I don't really care for it. So we stopped optimizing for and we started optimizing for revenue. And a lot of the keywords that were driving us revenue weren't generating that much volume in traffic. And then on top of it, we started finding new keywords that would drive revenue, but a lot of them were really long-tail queries that were like 8, 9, 10 keywords. They drove great revenue, terrible traffic, but we just didn't give a crap. And I think, I'm not saying Zapier's doing this on purpose or anything, but I think a lot of businesses are guilty And I had to learn this the hard way of just saying, oh, SEO, I need more traffic. You know, feed the addiction. It's like a drug. Give me more, give me more, give me more. I need more rankings. But if it isn't driving you revenue, who cares? And I'm not saying SEO is bad. I think people got it really wrong where they optimize for visits instead of optimizing for revenue.

Yeah. Let me ask you this. How much do you think Neil Patel, your website right now is worth? Like how much would you sell your website for?

It was funny because you reached out to me saying someone wants to buy my website. It was one of the SEO tools, right? And I just responded with no thanks, I think, or something like that. I didn't even care to discuss it. And I don't know who, but someone reached out to you to reach out to me because they didn't want to come to me directly, right?

Mm-hmm.

And whether it was $10 million or $100 million, I wouldn't end up selling it even if it was $200 million. One, it's tied to my brand name. Two, my business is big enough where, don't get me wrong, I would love to take hundreds of millions of dollars, but my business is already worth a substantial amount. So I wouldn't sell it for a few hundred million bucks. But funny enough, the website, probably neilpatel.com, probably doesn't drive more than 15% of our revenue. Maybe 20% max. I don't know the number off the top of my head, but I know it can't be more than 20%.

Would you sell it for $1 billion?

Yes, give me my check. Everyone has a number.

Everyone has a number.

I don't know if everyone has a number. I've really met people who don't have a number, but I definitely have a number.

Yeah.

Just the question of what it is.

The way to Neil's heart is have numbers. Have numbers prepared that make him happy. Cool. So look, that's on Zapier. And I just Googled, by the way, I Googled Zapier ARR 8 months ago. They're at $250 or $230 million ARR. They're probably at, I don't know, we'll call it $250, maybe $280 or something now. Pretty good, but definitely not worth $575 million a month. But they're going to continue to compound. They're a very sticky product too.

And not worth $5 billion anymore, right? It's just like—

Well, valuations have come down a lot too.

Yeah. What are SaaS companies getting these days? The public markets are giving what, 7 times, 6 times? 6 to 8.

Yeah, 6 to 8, which is 7. So yeah.

Yeah. So let's say there were 10, even at 10 times, you're talking about $2.5 billion-ish and change, right?

Yep. Yep. Yep. Yep. All right. What do you got on your side? We just went 3 in a row on me.

On a side note, did you see the India OYO example? They bought the Hooters Hotel in Las Vegas and they renamed it like OYO or something like that.

No, no. What are you talking about?

Is this India? So this is like the Airbnb of India, right?

Oh yeah, yeah. Oh yeah. Yeah, yeah, yeah.

Oh yeah. So I'm saying the name wrong probably, but they ended up having a $10+ billion valuation. Their latest round, $2 billion. And I'm not mocking them or I don't think it's funny, but it's something that we can all learn from. And then I looked at it and I was like, wait, you guys raised more than $2 billion and they're trying to be like an Airbnb of, you know, Asia or whatever, the rest of the world. And some of the properties they own, some of them they don't, they're for long-term stays. And one of the big reasons that they got crushed is the economy and valuations were overinflated. The other big reason that they got crushed, and people tend to forget this because this can affect your marketing so much, is reputation and customer service. People were just really frustrated with them and the experience that it just tanked their brand. And it doesn't matter how much SEO traffic you have, how many paid advertising you do, how much money you have in the bank, If people really despise your brand and they're over it, you're screwed. That's pretty much the end of the business. It's really hard to turn things around and change people's perception. And that's why Warren Buffett always says, you know, he said it before in one of his annual letters, if you had the choice of making a quick buck or not making it and protecting your brand, he always says choose protecting your brand.

And he said it takes 10 years to build a reputation. It takes 10 seconds to destroy it. Something like that. We're paraphrasing.

Yes. And it doesn't matter who you raise money from. You could raise money from Air— I think they actually took some money from Airbnb or Sequoia or some of those guys. But still, it's just like you screw up your reputation, that's it. It's hard to come back.

I got to take a minute to tell you about the Agency Owners Association. This is a peer group for agency owners. Think YPO or EO, but for agency owners. And I just wanted to read you a couple of testimonials. So this first one, So the first one comes from Carrie, and we asked her, what do you like most about the group? She said, having a group of people to discuss and bounce ideas. The leads are great too. Yes, we share leads in this group as well. This one from Aliyan, he says, the ability to really post whatever I want and need and the group responds. Great experienced members. Getting a lot of insights from conversations with other members. Getting a lot of value from sessions from Eric. Getting advice from others as well. And so if you want to grow your agency faster and you want a peer group to do So just go to marketingschool.io/agency. This is a group that both Neil and I created, and our hope here is to create a vibrant community of agency owners and do a lot more with it in the future. So again, marketingschool.io/agency, and we'll see you inside. All right, so we are going to talk about some AI overview data that will blow your mind. But before we do, we're going to give a quick reminder or overview, I should say, on AI overviews. And so the beauty of AI Overviews is it was just SGE rebranded. So Search Generative Experience. This is the AI-generated answers that you get when you're using Google search results. It kind of looks like Perplexity. If those of you that have used Perplexity AI, it'll give you an answer and then it'll cite a couple of different examples. And it used to be, I think, 80+% or so a couple months ago. And now it's come down a little bit. And then I wanted to share some data. And then we can react to this data from Aleyda Solis. So she's an awesome SEO. And so she says, AI overviews research by Search Engine Ranking, which is a tool I believe for SEO. So comparing pre and post rollout results on 100K keywords, only 8.71% of keywords have AI overviews versus 64% before release. So anyway, a lot before, a lot less now. Longer queries tend to trigger AI overviews more with 10-word queries triggering 19% of AI overviews, which makes sense. Long-tail keywords are also less risky for them to get in trouble on because they're continuing to test this. And then the average AI overview text length is approximately 4,300 characters. You can read more, just search SE Ranking AI Overviews Research. And then if I click on this graph over here, this will be the last thing, is if you look at the data as of January 30th, 2024, you can see 63% and then 8.71%, 63% had AI overviews, right? Presence in search. And then now the blue is 8.71%. And then you can see now, before it was 12% AI overview, no AI overviews. Now it's 91%, almost no AI overviews. So anyway, that's some more food for thought as Google continues to roll this out.

So we did an interesting study where we looked at the SEO traffic for 400 of our clients within the United States. Google organic, specifically United States, because that's where AI Overviews rolled out. Before the AI Overviews rolled out, our clients had, that 400 had 43.92 million impressions. After, it dropped down to 43.05. So it was a decrease of 1.98%. The total clicks though went up from 942,000 to 955,000. This is week-over-week comparison. But clicks— impressions went down 1.98%, but total clicks went up 1.32%, and click-through rates went up 3.25%. Negligible, but at least it's not backwards.

Yep. So yeah, I mean, you know, the— I think this, they'll continue to roll this out over time, but I'm glad that they pulled it back because they got a— we talked about this before, there's just a lot of random answers. With the AI overview stuff. So anyway, some food for thought for you. The number one challenge for businesses is hiring. And more specifically, the number one thing I get asked for all the time is, Eric, where can I go find an amazing marketer? And the reality is right now, when you think about the world, we have inflation. That also means wage inflation right now. And it means that when it comes to hiring talent, you can't spend as much as you would've in the last couple years because it's just become too cost prohibitive. And so we've partnered with one of the best offshore recruiting firms when it comes to marketing. They've been a great asset for us, and I believe that they will be a great asset for you. All you have to do is go to marketingschool.io/hire. Again, it's marketingschool.io/hire to learn more. You can fill out the form there and we're going to place you with the best marketing hires that we can help you find.

Google's AI overviews are showing less and less, which you talked about already. In that tweet. But Reddit is now actually not a top 10 answer provider for the AI overviews. It was one of the most popular answer providers for the AI overviews. But according to some research that was released by Search Engine Land, they ended up breaking down how Reddit is not one of the top 10 contributors to the AI overview answers. And I think this is really important because Dude, I was just at an event this morning and someone's like, should our business just spend tons of time responding on Reddit so we can get into AI Overviews? And I'm like, well, it doesn't work as well as you think because if you just go and respond to all the stuff that could be related to your space, it's Reddit getting the traffic, not really you or anyone going to your website from it.

Yep. That's interesting. I mean, yeah, we're actually, I mean, I'm sure you're getting this too from prospects, but We're getting a lot of people asking, oh yeah, we don't know about our SEO strategy anymore. We think we want to go into Reddit and Quora. And I just think it's too early to make any moves like this. I mean, there were some clients or prospects, I should say, they were previously heavily relying on their search engine rankings and they were relying on their affiliates and both their pages and the affiliate pages got pushed down. And what is Google actually favoring more now? And I actually have a link on this too. Google's now, if you're in SEO, if you're in e-commerce and you're doing UGC, which is like community content like Reddit, Quora, those communities tend to work a lot better. So again, e-commerce and UGC work really well right now. Whereas when you have ad-based websites or affiliate-based websites, those are all getting pushed down now. So food for thought.

Yeah, so real question is, does Google really prefer opinions over websites? Because a lot of these sites are just more opinion-based and they're quick and dirty answers more than anything else. I also think the problem that you have is if you start pulling this stuff into AI overviews, a lot of people on Reddit have like sarcastic humor or unique humor. Like, should you jump off a bridge? Yeah, why not? Go kill yourself, right? Like, of course you and I don't mean that. We would never recommend that. But where are they getting this from? That's— that was one of the responses in the AI overviews. They're getting it from some sites that have dark humor. Yeah.

Yeah, I mean, again, I think the good thing about AI is, it's a side note here, is it's going to force people to think for themselves a little more. And I don't think enough people learn, know how to think for themselves, especially in today's day and age. All right, everyone. So that is it for today. Please don't forget to rate. Go ahead. Yes.

Make sure they go to marketingschool.io/agency.

I was going to do that. So please don't forget to rate, review, subscribe first. And then if you're an agency owner and you want to grow faster, go to marketingschool.io/agency. That's where we help agency owners grow faster. A lot of people have been saying the community has been great, that they're— they've actually got a lot of resources, templates, and a lot of coaching that's helped them sidestep mistakes. So that's the group Neil and I have. Please join it if it seems like it's fit and there's no long-term commitment. That's the cool thing about it. So that being said, we will see you tomorrow.