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“So I made a pitch to AOL, a business idea. I kind of forgot about it. About three months later, I got a call from somebody in their Tyson’s Corner offices in DC…”

Interview by Mike Sullivan


Hi, I’m Mike Sullivan. Thanks for joining us today on M.O., where we feature small business owners and entrepreneurs and then bring you hints, tips, insights, and perspectives on what it takes to be successful.

Joining us today is Mike Ragsdale. He considers himself to be a habitual entrepreneur. He’s worked with large companies, such as AOL Time Warner and Playboy, as well as many others. He’s joining us today to talk about his latest venture, TownWizard.com. The goal of the new company is to help small town entrepreneurs seize the mobile app opportunity.

Mike, thanks for joining us. If you could, can you start out by telling us a bit about your background in leading up to TownWizard?

Sure. I went to school at the University of Alabama, got a Master’s degree in advertising and PR. When I got out of college, I sent out resumes like everybody else and expected this landslide of offers to come in, and they didn’t come. Not only was there no landslide, there was hardly a trickle of anything. So I was sitting out there at my apartment thinking, “What am I going to do? I’m not getting these job offers like I thought I was going to do.”

So I called a friend of mine who had landed that “dream job” in an ad agency. I asked him, I said, “What do you think I should do? Do you know of anything going on over there? Are there any opportunities?” And he said, “Well, how much are you making doing your consulting?” Because I was doing consulting on the side. By consulting, I mean designing newsletters, whatever I could do to cobble together a living. I said, “Well, you know, I’m probably making $18,000 a year or something like that.” And he said, “Where are you right now?” I said, “Well, I’m out at the pool at the apartment.” He said, “I’m making $22,000 a year and I’m sitting in a suit in a cubicle. So you do the math.” That got me thinking that there was some benefit to not being in that tie and not being in that cubicle.

So I actually took out a small business loan, and this was around 1994. Got a Macintosh computer. It came with this little thing called an AOL disk, which at the time, every computer in the world was coming with. AOL was unheard of, they were unknown. But I got this thing and was really blown away by what it potentially represented. So I began to use it, and this is before the Web existed really. This AOL was in third place behind CompuServe and Prodigy and Microsoft. None of those players had entered the Internet space yet.

So I made a pitch to AOL, a business idea. I kind of forgot about it. About three months later, I got a call from somebody in their Tyson’s Corner offices in DC, and they asked us to come up and talk about it, so I did. And long story short, we basically got AOL to invest some money in our startup, grew it for the next six or seven years, from me and a couple friends to a pretty sizable content building studio for AOL as well as companies like Playboy, Microsoft. We were kind of some of the pioneers of online community building. We didn’t know to call it social media back then, but in essence, that’s what it was. So I did that for many years.

We got out at a very good time. Then got into a couple businesses that I just had no business being in, literally. They were not successful, and that’s because I lost my focus on what I do best and thought, “This is easy. Boy, look how easy it is to make money.” And got out there and did things that I wasn’t passionate about. I was doing it just because it was entrepreneurial, just because it looked like an easy way to make money. So I learned a lot of valuable lessons from those failures, and then at a certain point decided to pick up and move to the beach, and got down here and started enjoying more of a laid back lifestyle. Again, that’s precisely when things happen, when you do what you’re passionate about and you do what you love.

I started a little site just as a hobby that became a local guide to what’s going on here at the beach. It began gaining traction, gaining momentum, growing in fans. So we started a Facebook page, and we’ve gone from a few dozen friends to I think 47,000 as of this morning. This is in a town that’s got 10,000 residents. So, it’s not a very big place, and certainly not on the map in the grand scheme of things. But that said, then we built this company that helps other small town entrepreneurs launch businesses in their towns, take advantage of the mobile guide opportunity, and that’s how TownWizard.com came about.

That’s great. Hey, am I correct in that you sold a company to AOL?

That’s right. Back in the days of Heckler’s Entertainment was the name of the company. We started out with an online comedy site, and that was what we were always known for, because it was the first thing we did. It was really kind of the world’s first interactive comedy site, and what that essentially meant was we weren’t the comedians. We didn’t know it, but we were pioneering the concept of user-generated content. It had never existed before, and that’s what caught AOL’s attention in our business plan was that David Letterman has a staff of writers, and sometimes they’re funny, sometimes they’re not. What if we let the world be our writers?

We were the most successful launch in AOL’s history up to that date. We could post a topic, and let’s just say it was a top 10 list. We could post a list like top 10 rejected names for Madonna’s baby or something like that, and we would get thousands and thousands and thousands of responses in a couple hours. Then our editors, all they had to do was go through and pick the ones that made them laugh. Then we learned how to shine the spotlight on these users and give them prizes, give them recognition. So every day, you were guaranteed that you were going to laugh, because you literally had tens of thousands of people participating in these online games. So Hecklers was our first interactive brand.

Then, of course, AOL was kind of taken aback that a bunch of rednecks in rural Alabama had figured this out. So I think they kept asking us to create more and more things. So we began building. We built a video game site. We built a sci-fi site. We built trivia games. So we were kind of this little studio that created these branded online communities that had very passionate followers and fans. We didn’t know it, but we were really building the concept of community, the concept of stickiness is what they began to call it later on. But ultimately, it’s social media. It’s building a community around a concept, whether it’s humor or a location or a band or a town. That was really the early days of it, and that’s kind of what brought us here to this point.

Looking back on the time you spent with a company like AOL, what’s your perspective? What are your feelings today looking back?

I think, and I’m not belittling anything or any of the people at AOL, they were all very smart people. But I think coming from right out of college and you suddenly go to these big offices in Washington, D.C. or in Arlington or Dulles, and you’re overwhelmed by the massiveness of it. I think that the immediate assumption was that everybody here is extremely intelligent, extremely bright. You were almost scared to be there. You know what I mean? You felt like you didn’t belong there, that we were out of our league. The more we got around them, the more we began to realize that we did contribute something, we did have something of value, we did see it in a different way.

I think Ted Leonsis, who was kind of our mentor . . . Ted, if you’ve never heard of him, is a serial entrepreneur himself, and he not only was instrumental in AOL’s success in those days, but subsequently has been a huge backer of Groupon and numerous other companies as well. He owns the Washington Wizards and the Washington Capitals. He owns the coliseum that they play in, etc. So he’s a very successful entrepreneur, and he was our inspiration. He invested in our company because he recognized that we saw it in a different way. We weren’t thinking two-dimensionally.

He often said, “It wasn’t Rolling Stone Magazine that started in MTV. It wasn’t Sports Illustrated that capitalized on the cable market. It was ESPN. Whenever there is a new medium, there are new players that emerge. It’s not the old, established players that get it. They typically are kind of set in their path. So it takes young, fresh, entrepreneurial ideas, when a new market emerges, to fully capitalize on it and to show people the new direction.”

So I think that we’re especially seeing that now. We saw it a couple years ago in the social media space, Facebook, etc. We’ve seen what young, fresh talents came in and did with that space. I think we’re seeing that now in the mobile marketing space. I don’t mean young as in the number of years. I just mean young in terms of your outlook on an industry. So I think that mobile marketing, we’re about to see the same sort of explosive growth. We’re starting to see the same sort of innovation.

At AOL, it was very much a pioneering sense of spirit and discovery, and that was what made it invigorating and exciting, and it was a very entrepreneurial environment to work in up until it became this massive behemoth and became very corporate. That’s when they started running into problems.

Okay. So tell me about TownWizard. Where did this idea evolve from, and where is it at today?

Right. So I have a local website called 30A.com. 30A is a highway here, kind of like saying Route 66, and it ties together a bunch of beach communities, beach resort areas. So it’s a wonderful place, and it’s really very Caribbean like waters and white sand. It’s kind of a hidden gem here in the United States. It was just named one of the top 10 beaches in the world by Frommer’s this year. The only other location in the United States was in Hawaii. So it really is a hidden jewel.

But what happened is, as I developed this interactive guide, not only the website but the mobile apps, I began to be approached by entrepreneurs, or at least people, enthusiasts in other cities and saying, “Hey, have you thought about doing something like that in the French Quarter? Have you thought about doing something like that in Key West or Savannah?” Mark Twain said, “Write what you know about.” I really don’t know anything about those markets.

So it began to occur to me that Google doesn’t either and Facebook doesn’t either and Groupon doesn’t either. They’re never going to know those markets as well as a local. Now, if you’re in New York, San Francisco, Chicago, yeah. All of those Groupons and all that stuff are very useful. But you come to Santa Rosa Beach, Florida or Coleman, Alabama or Carlsbad, California or some of these smaller areas, it just doesn’t apply. At the end of the day, there are entrepreneurs in each of those towns that want to take advantage of the mobile opportunity.

So what we decided, rather than us trying to conquer each of those markets and to become experts in a town that I don’t live in, let’s empower locals with the same tools that I’ve already developed, the same Android app template, the same iPhone app template, the same CMS, the same marketing collateral, the same marketing strategies. Let’s give those to entrepreneurs so they have a three-year head start, and they don’t have to spend tens of thousands of dollars and many, many months, if not years, to catch up. Not only do we give them all the tools, but you’ve got 125 other entrepreneurs like yourself all capitalizing on the same opportunity. So when somebody in Austin, Texas discovers something that works, we immediately disseminate it to all of our partners. That way, we can discover something that works in Paducah, Kentucky, and suddenly the guy in Atlanta and the guy in Napa Valley and the guy in Tampa can capitalize on the same opportunity and idea the next day.

How are you advertising or marketing the business? Do you have any unique marketing strategies you can share with us?

It’s fun, because every day I’m surrounded by 120 other like-minded entrepreneurs. I mentioned Paducah, Kentucky. Mobile apps are what we’re hoping our partners get launched. He had a great idea. I don’t know him personally, but he’s a financial analyst or something. He said, “I have this idea. There are only six mobile phone stores here. So I’m going to go out, and I’m going to make an offer to those mobile phone stores. I’m going to pay you $2 per phone that you install my app on, the Paducah, Kentucky app.”

He said all of them accepted. So now, every time they’re installing a phone or setting up somebody’s phone, “Do you want the local app? Do you want the Paducah app?” Of course they do. So he recognizes that for a $2 investment, he will be able to capitalize on that audience for years and decades potentially with all the marketing opportunities, etc. So it’s a great investment for him. So as soon as we heard that idea, we thought, brilliant. So we disseminated it to everybody so that all of our other partners can take advantage of the same concept.

In your experience, what’s the most important factor in achieving success?

Well, at the end of the day, I think it’s, number one, being authentic. Where I live, it’s kind of a beach resort area. Again, so there are only 10,000 people that live here full time. In the summer, it’s slam packed. You could shoot a canon in here in October and not hit a soul. So there are only three or four months out of the year where it’s highly populated. But people have a passion for this area. They save up their vacation days all year long just to come spend a week here.

So, I kind of liken it to Jimmy Buffet in a way. He is self-admittedly a very mediocre singer. He’s a mediocre guitar player at best, but what he did was he connected with the desire of probably 80% to 90% of the world’s population to retire on some tropical beach somewhere and drink Mai Tais or margaritas. It’s a fantasy that most of us have at some point. So, he gives us that lifeline while we’re sitting in our cubicles in freezing Baltimore or freezing Sioux City or whatever. He’s that connection we have to that vision of where we want to be.

So with 30A, for example, I decided that on a micro level, that needs to be my role way here. I need to keep people connected with this place that they already love. So I think part of the trick to the success is don’t over-market your own brand or your own products. Bring something of value to the fans. So in my case, I sit there and watch. If I make a post and it’s self-serving, I’m selling T-shirts or I’m doing this or I’m doing that, I can see the response is not nearly as exciting as if I go out on my standup paddleboard and capture some footage of dolphins swimming past and I post that and there’s no ulterior motive. They love it. It becomes viral very quickly, because that’s why they watch me. That’s why they watch 30A. They want to be there with the dolphins. They want to see that sunset over the water.

So I think that it’s understand what your audience wants. Do not look at Facebook as a . . . so many people have said, “Man, that must really drive a lot of traffic to your webpage.” And honestly, I could care less about driving traffic to my webpage. Facebook is its own thing. I’m not building a website. I’m building a brand. As long as people are having a positive experience when they interact with my brand, I’m happy.

So if they come to my Facebook page and never go to my website, I could not possibly care less. If they go to my website but never download my iPhone app, I could not possibly care less. It’s great if they do. Don’t try to view Facebook as a way to funnel people to another location. Look at it as a tool for interacting with people who are interested in what you’re doing. Don’t try to sell them something. Try to bring something of value to them. Ultimately, you’ll develop a relationship with them, and they will swat your hand, honestly, they will swat your hand if you step out of line.

I decided early on with my Facebook page that I was going to be 100% positive. I was never going to trash a restaurant. I wasn’t going to focus on all the bad news. If you want bad news, you can pick up the newspaper, you can turn on the TV. This is where everything’s happy, everything’s good, everything’s fun.

Last year, you might have heard about this little oil spill that happened. I live at the beach not too far away, fortunately just far enough away to where we were not directly impacted. But the media attention killed us. We only get three or four months out of the year to make our money here. It’s during the summer months, and all of the media hype absolutely killed us. Reservations were canceling right and left, down 50%. Businesses were killed. There was hardly a drop of anything that ever reached our beaches. That said, the perception is there.

So I basically, at a certain point, thought this is real. I started to freak out a little bit myself. I had not ignored it. I just decided that was up to the news companies to focus on for a while. But when it became something that you couldn’t ignore anymore, I remember stepping outside and saying, “Okay, I’m going to have to address this.” And the minute I did, my audience corrected me. The minute I started to preach, if you will, about what was going on, my audience said, “Look, we know it’s happening. It’s everywhere. This is the one place we can forget about it. This is the one place where I can still think about dolphins and sunsets. Please, if I want that other stuff, I’ll go over here and get it.” So I think it’s important to know what your audience wants from you and to just keep giving it to them.

Thanks for talking to us today, Mike. I appreciate it.

Thank you, Mike. Bye-bye.

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