“It’s basically a new software that helps sites increase traffic and also to make money while giving their site visitors something that they actually would like on the site.”

Mike: Hey everyone, it’s Mike Sullivan from MO.com. Thanks for joining me today. Today I’m talking with Neil Mody of nrelate. If you or your company has a blog or if you’re a blogger then you will be interested in Neil’s product. Neil developed a piece of software that will help engage visitors to find additional content on your site or elsewhere.

Neil, thanks for joining us today. Would you mind telling us a little bit about the product?

Neil: Sure. nrelate is a content marketing and recommendation company. What we do is we provide software to websites, very much like MO.com or other publishers around the Web, that help retain their visitors to engage in their traffic more.

What we do is give them a little piece of code that they put on their website, and then what it does is it allows their site visitors to find more content from their archives or other partners that they set up that they might like. Then it also allows the site owner to engage in a form of advertising that’s called content marketing, which they can now actually make money.

Let me draw the picture since it’s a little easier to describe. We actually are on over 20,000 sites. So you’ve probably seen our software as you navigate the Web. When you read an article on a publisher, let’s say a blogger, and you scroll to the bottom and you see the section that says e-mail us or related articles or anything like that, that could be our software.

In there, what you’ll see is links to other articles you may be interested in reading. You’ve probably clicked on these on some sites. Links to partners that the publisher could set up. Basically, circulate traffic amongst their peers or colleagues or other sites that the site owner has. Or monetize through sending traffic to places that the user might be interested in going.

It’s very simple, straightforward. It’s basically a new software that helps sites increase traffic and also to make money while giving their site visitors something that they actually would like on the site.

Mike: Neil, tell me a little bit about your background. What kind of led you up to creating this software?

Neil: Sure. I actually have a pretty varied background. I went to school here in New York pretty much for my entire educational career, but it spanned through really a math, statistical, and computer science background. Then over time I worked at big consulting companies, but I’d always been interested in content.

I actually went back for graduate work in philosophy up at Columbia University because I guess I’m a reader by heart. My apartment is littered with books. I consume content non-stop, and that’s what really got me into the space. A few years ago I was just thinking about where this space was on the Internet, and we weren’t really impressed, some friends and I, with what kind of recommendations were given on sites.

What we found was I’d go to a site, I’d see some stuff I’d like but not exactly what, and I’d go back to Google and search more and I might end up on the same page of that same site that I didn’t hit before. I’d hit the same site. Somehow Google helped me find something I’d like on the same site I was already just on.

So I said, “Something is wrong here. The system’s a little broken.” And I thought we could build some software that really helps the publisher have the user stay on their site longer and also bring out content that might be useful for a reader.

In typical fashion, we started working nights and weekends, some friends and I, on the software. Then we tested it on a few sites, and people really liked what we were doing. So we quit everything else we were doing and started this company about two years ago.

Mike: What kind of feedback are you receiving from people that are using nrelate?

Neil: Nothing but praise actually. We’ve been really lucky. I’d ask you to go ahead and Google us and read some of the reviews that people have about us. I think we’ve definitely elevated the space. I think this has been around for a little while, but never gotten the attention it really rightfully deserves.

In pure numbers speak, what we do is we do an average page view increase for people of over 6%. If you just install this software on your site, you’ll see your core web KPIs they’re called, key performance indicators, which is your page views increase, your bounce rate decrease, your average time on site go up.

For publishers large and small these are really core metrics that are important, and our software does that completely for free. Obviously, the next big question is, is it for publishers that want to use this as a revenue source? Recall that I mentioned the third option, which is allowing third parties to essentially put in a related article that is sponsored. How much money does it make?

We’ve seen great engagement on those units as well. Some publishers are making more than what they’re making from other ad mechanisms, like AdSense, etc. on our software.

Mike: Is there a cost for using nrelate?

Neil: No, it’s completely free to the publishers. I mentioned before that I’m a content lover, so we give the software completely free to publishers. There’s absolutely no cost. The only money changing hands is if they turn on the optional advertising, and once they do, the third party advertiser pays us and we actually give money back to the publisher. So not only is it a way to increase traffic, but it’s also a way to increase revenues without taking other advertising off your page or other different units off your page.

Mike: You managed to build up to 20,000 sites using nrelate in about a year. How did you manage that? What was your marketing strategy?

Neil: Well, it’s a little more than a year, but we’re just about at 20,000 sites using our software. I’d actually credit my partner, Oliver Wellington, with the strategy around that.

We basically looked at the landscape of publishing online. You have these big heavyweights, you know the AOLs of the world, the MSNs, Huffington Post, New York Times, and all these big companies. I think if you’re a small startup like us, you can’t realistically think they’re going to try out your software no matter how good it looks or what connections you may or may not have. It’s really tough to go through.

We took a very opposite approach. We started figuring out who in the blogosphere would have a decent audience that this software would compel to that would really take publishing seriously. We reached out to them, talked about what they like and don’t like about products in this area, and really built our product around their input.

Then from there, we tried to keep it open source. Our front end is completely open source, so people change it, modify it. If you notice one thing, our software, I’ll send you some samples after this; you’ll see that it actually looks very different on different sites because not every site is the same. Some are more artistically driven. Some are more just pure text, give me the recommendation in straight text. So our software lets publishers decide that.

What happened was our core audience built up pretty quickly, and quickly they recommended it to their peers and people started seeing it on those sites and it kind of grew from there. Then over time, I think what happened was we get to this place where you get this critical mass number where it just kind of grows from itself.

Now we’re getting close to 100 new installs a day, and obviously getting bigger publishers interested in what we’re doing and all that kind of stuff. It’s great. It’ll be a good 2012. Keeping up on the tech side is the hard part sometimes.

Mike: Outbrain is known as raising a huge amount of capital. In comparison, you’re a relatively small company but experiencing massive growth. How are you able to compete with that on a lower budget?

Neil: I wouldn’t say we really compete with them. We’re very different types of companies. I admire them. I think they’ve done a great job. But again, we’re very different. Like I said, the genesis of the company is very different. We believe in serving the entire publishing landscape. We really focus on a different area of the market right now.

I think they’re doing a great job, but also they’ve been able to throw a lot of money at the problem. What we’ve done is we’re a team of five full-time. Our part-time and intern staff are great, but we’re really five people pushing this, and I think we have publishers that compare us all the time. I don’t want to speak negatively about them in any capacity. They’ve done a great job.

I like to say that we’re just a different company. We look at content differently. Our main goal is the view of the publisher and not necessarily the advertiser. I think that’s resonated with a lot of our customers.

Mike: Neil, what’s your advice to others out there who have a great idea and they’re thinking about making the move to start a business?

Neil: I’ve learned a lot. I’m a little older. I just turned 35. So I’m a little late for getting into the startup world, or the typical entrepreneur in the startup world, I’d say. One, I’d say, if you’ve been thinking about it, do it earlier. My body can’t keep up as well as it used to even though I don’t sleep much. I would have loved to have done this a long time ago.

That being said, coming to it late has its advantages as well. You have a longer view of things. You have, obviously, financial resources maybe that you’ve saved that help bootstrap the company for a while. I’d say with the Internet there’s a lot of noise right now. You have to really think things are going to take a little longer than expected.

Any good startup story does take a while. We always hear these overnight success stories. Those are rare. We’ve been at this for about two years and only now feel like we’re getting to a place that we’re just breaking through the noise in this area to where people hear about us, we get inbound requests through our contact form from name brand publishers, name brand advertisers.

My advice is, one, start it as soon as you can. If you’ve been thinking about it, every day that goes by is a day that’s lost. Two, be patient once you start. It takes a while and be ready for a long haul.