Forget PMF—Neil Patel says to give your product away for free instead. | Neil Patel, Co-Founder of Neil Patel Digital

Neil Patel (00:00:00):
But the VCs don't give a shit if you have product market fit. What they really care for is you have churn, but your upsells make up for the churn plus more. And what I'm getting at is giveaway software for free. Because service is a much bigger industry. Go sell them on services and go figure out how to use automate as much of that kind of stuff, and now you've got your sexy company. Just in a different way of thinking, and you've got a much bigger market cap.

Previous Guests (00:00:24):
That's product market fit. Product market fit. Product market fit. I called it the product market fit question. Product market fit. Product market fit. Product market fit. Product market fit. I mean, the name of the show is product market fit.

Pablo Srugo (00:00:36):
Do you think the product market fit show has product market fit? Because if you do, then there's something you just have to do. You have to take out your phone. You have to leave the show five stars. It lets us reach more founders and it lets us get better guests. Thank you. Neil, welcome to the show, man.

Neil Patel (00:00:51):
Thanks for having me.

Pablo Srugo (00:00:52):
Dude, I'm excited to dive into kind of, you know, digital marketing, and obviously things are changing a lot right now with. Just what you can do with AI, but also even like search is changing itself. A lot of people talking about what that means for optimization. But, maybe you can tell us a little bit just about yourself, your background, just to kind of level set it for some context.

Neil Patel (00:01:11):
Yeah, sure. So I'm a serial entrepreneur. Started off mainly creating software companies. I've been doing this for 24 years now. My latest company is NP Digital. We're a global ad agency. We have some software divisions as well. But yeah, I've been doing that for seven years. This will be maybe eight.

Pablo Srugo (00:01:30):
And do you work mainly with large companies or do you work with a lot of early kind of zero to one startups as well?

Neil Patel (00:01:35):
Not too many zero to one. Majority of our revenue comes from enterprise. Majority of our clients are actually SMB, but majority revenue comes from enterprise.

Pablo Srugo (00:01:45):
Tell me a little bit about, maybe we can go through like an example. Just to get things started about one of the products that you've launched. Maybe recently, or some campaign you've worked on recently, and some of the things that you did on the. You know, on the growth and digital marketing side just to kind of get us started.

Neil Patel (00:02:00):
Sure, so we bought a tool called AnswerThePublic years ago for $8.6 million. When we bought it for $8.6 million, it was doing maybe like $100-ish grand a month in profit is what they claimed. But they had little to no expenses on their books, like, no people. So it wasn't really doing $100 grand. That was just what they pitched when they were selling it. And we took that product and added more features. So think of, like, keyword research. If you're researching keywords for Google, for a blog article. We ended up adding search volume data. CPC data, how much you would pay for a keyword. And then we started adding in other features like doing the same for YouTube, and then Amazon, and then TikTok, and Instagram, and the list goes on and on. So we did that, and the traffic on the thing grew to like, more than double by just releasing more features. So that was one key thing that's worked out really well for us. And over time, a team runs it, I don't really run it. The revenues tanked by almost half, and the traffic's tanked by almost half. Revenue probably not a half. It's probably exaggerating a little bit too much, but the revenues probably take out like 35-ish percent, okay? And what the team started doing is being more aggressive. They started looking at the data, and they're all just like, Huh, if we block CPC data and give it for like, or search volume data and CPC data for three keywords. And then the remaining, you know, you have to start a free trial to get more data. It was one of the biggest conversion drivers. So, instead of giving away three for free, let's give away one for free. So you get it on one keyword and you got to pay for the rest. But when they did that, even though the conversions increase. Top of funnel of the amount of people using the tool drastically started decreasing. That has dropped down by roughly half, and when I say half. I looked at the analytics, no joke, end of last week and it was almost 50%. A little bit shy of 50%, but close enough, right? I'm rounding here. Even though they were able to increase conversions from visitor to paid. They dropped the top of funnel. So I'm doing an interesting experiment. I'll roll it out partly this week, more fully next week. I'll fully roll it out within two months, and I'm doing it where, hey, just show them all the keywords. Don't block the keywords. I'll make them pay. And then I'll tell them, which I already did, they're working on these changes this week. Instead of giving away one keyword, go back to the three I had it. And they had it where you put in a search because it's keyword research, and you see a report. But right when you see the report, asks you to log in. You can click the X button to register or log in, and I said, don't even show them that prompt. Just give them the full report, and they had it where the report has multiple sections. The first section you can see if you don't register a login. The second section, it says, to see this section, register. And I'll be like, just show them this section. Don't make them register. So as you can see here. What I'm getting at is I'm reducing friction points. And my thesis is, by creating a better top of funnel. Even if your visitor to conversion. Visitor to paid ratio is much lower, a bigger top of funnel makes up for it, and that's how the business was run when I was running it myself. Because when we first bought the product. The team had it for six months, nothing really got done, they weren't prioritizing. So I took it over after the six month mark and I started making changes. And in three months, I no joke probably took the revenue just from a monthly standpoint, right? We saw it go up almost four times, a little bit less.

Pablo Srugo (00:05:47):
Wow.

Neil Patel (00:05:48):
So, three and change. On a monthly basis. So then it would have scaled more and more, you know, you assume you fast forward. We've owned the thing for years. But the point I'm getting at is that's an example of the team optimizing too much for revenue and not optimizing enough for user satisfaction. So you could call a product market fit. I don't think the product really truly had a product market fit. I look at it as more so, people are much more satisfied with the product. Didn't have product market fit, but they were a better user experience and it was closer to product market fit than it is now. Because it's the same features, but you're showing them more of it and giving them more value before you made them commit. Now they're trying to get people to commit with barely seeing anything, and then people like, I don't know why I should commit.

Pablo Srugo (00:06:37):
How do you think? I mean, I've got a question about product market fit, but let me ask this other one first. How do you think about like, what's the framework for thinking about how much to give away? Because intuitively, I mean, the more you give away, frankly, people love free stuff. So you would think they'd be happier, they'd use it more, maybe they'd tell more people, but at some point you do need to get them to pay. How do you think about where to draw, is it all testing? What's the kind of framework or gut piece to where to draw the line?

Neil Patel (00:07:04):
On what to give away for free and whatnot? 

Pablo Srugo (00:07:05):
Yeah, that's right, that's right. 

Neil Patel (00:07:07):
So I look at it as economics, all right? And I'll give you an example of this. This is not relatable to most of the people who are listening, but it's an interesting way of how I think about business that people could copy. So let's hypothetically say that product, forget revenue, let's just look at profit. All right, I'm going around here because we take money in multiple currency. So I don't know the exact number off the top of my head. But let's call it that thing, that's $200 a month in profit, $200 000. All right. That tool that I bought for $8.6 million. So right now, on a weekly basis. We get 18 to 20,000 registrants, okay, for a free user. 18 to 20,000 a week. 16% of the traffic is United States. That's right there around 2,880 registrants, okay? If I ask them for a full lead, name, email, phone number, URL, et cetera. I've tested this out in the past, I lose roughly half. Are you following me here? Because you're asking for more information.

Pablo Srugo (00:08:06):
Yeah. 

Neil Patel (00:08:07):
So you get less people. So now I'm at 1,440 registrants a week. All right, this is just US. Times it by four, 5,760. I also have an ad agency. I can give those leads to my team. People are registering for a tool, though. They're not necessarily registering and saying, Hey, Neil, I want consulting. We've generated revenue from that tool. We generate revenue right now from that tool. All right, so forget about the profit. Let's just, I mean, forget about the revenue expenses and all that. Because they can run that business-ly. But remember, I was talking about $200,000 per month. We have another tool called Ubersuggest. Which is in a similar space. And on Ubersuggest, when people go to the tool, we have an exit pop-up. You fill in with the exit pop-up, move the mouse, and you try to show them anything, right? Like, a thing that takes over the whole page. And we collect leads for consulting from that, but it's not directly. It's someone taking a quiz to get a seven-week action plan on growing their traffic. And then we take those leads and we close it for consulting. So it's a tool. It's a very similar tool, same audience. We're collecting a lead. The lead isn't on that tool identical, but we close 0.7%. So if I close 0.7%, right? That's not 1%, that's 0.7%, that would be 40 deals. All right. If a deal pays $2,700 on average through that exit pop-up, that's what we make. I'm using all countries. Keep in mind in some countries, you know, the revenue per customer is on the side, but it averages out. That's $108,000. I know my LTV, but let's discount the LTV, and let's say someone only lasts 18 months. That's $1.9 million in monthly revenue, right? because you times it by 12. So you're looking at an annual $23 million. And let's say I can run that at 20% margins, so $4.7 million in profit. So I would look at that business and say, Hey, if I ended up losing $200 000 in profit from the tool by collecting leads. In theory, I can make $4.7 million here in profit, but I'm robbing Peter to pay Paul. I'm losing money on one business to make money on another business. But the $4.7 million in profit, in theory, time will tell on this experiment is still greater than the $200 grand a month on the other side of the business. You know, so $200 000 call it $2.4 million. So this is roughly double $4.7 million. Now, if I made it fully free and I made your register. Not only with the top of funnily bigger, it used to be double in traffic and I probably can get the $1,400 to go to $2,800 again. Because I'm saying, Hey, you can actually get it for free, fully register. You're following me here. So then in that scenario, if I can double up to what I was getting by making it more free. You're now looking at nine in profit. If I can end up doubling the top of funnel again, because it's fully free, and get back to more of the traffic that I used to have. Now you're talking about $18 000 in profit. Is it worth making $18 000 in profit and losing two? Will the numbers work out that way? I don't know, but because there's such a big buffer and I have similar data points. And I have a massive sales team globally. I don't know how big my sales team is globally, and it's what do you really consider massive? Because compared to Salesforce or Microsoft, I have a small sales team.

Pablo Srugo (00:11:44):
Tell me about it.

Neil Patel (00:11:45):
But, I easily have more than 100 people dialing on the phones every single day, right? Or five days a week. Which I would say 100 plus person sales team is pretty decent sized sales team for most organizations. I could be wrong, but I would say that's probably a decent sized sales team. All I'm getting at is, and I can ramp up my sales team even more. But the numbers could pan out really well. So the way I look at product is a little bit different than most entrepreneurs look on your podcast. They look at product as, how can I get to product market fit? Have net negative churn, so my upsells surpass my churn and ideally by more than 10% or 20%. And I have amazing business. I'm assuming that's how most people think.

Pablo Srugo (00:12:33):
That's right.

Neil Patel (00:12:35):
And I look at that business as if you look at venture capital. Most venture capitalists don't go into a business and saying, How do we reduce churn? Most venture capitalists, look at a business as churn is really hard to solve. Let me just invest in the companies that have low churn or negative churn, right? Because the upsells make up, whatever you want to call it. Net negative churn or, retention or, net negative retention, whatever you want to call it. Most VCs don't try to fix it. They just invest in the ones that don't have the problem and they just focus on, Hey, how much more money you need to scale up. Because you don't really have churn your upsells make up for the lost revenue plus more, right? And I look at that model is really tough, to get the product market fit, and what is really product market fit? Because you can do a survey and it can show, right? The Sean Ellis.

Pablo Srugo (00:13:25):
Yes, the 40%, right?

Neil Patel (00:13:26):
That's the stuff from back in the day, and then you're getting into product market fit. But even if you have product market fit, that doesn't mean that you actually have, net negative churn. I think that's a term that most people are using, right? But product market fit doesn't guarantee net negative churn in which, your contraction or your downsells, or even your cancellations are made up from upsells plus, you know, and you want the upsells to ideally be more.

Pablo Srugo (00:13:52):
Yeah, of course. Because you could have customers that are really happy, really disappointed if you pulled it away. But they're not necessarily expanding, and if you have other customers that are churning. Then you'll have under 100% net dollar retention.

Neil Patel (00:14:00):
Correct! But the VCs don't give a shit if you have product market fit. What they really care for is, you have churn. But your upsells make up for the churn plus more. That's really what they care for. Would you agree with that statement?

Pablo Srugo (00:14:13):
I would. I would agree long term, and product market fit is almost like a signal to that, you know, in the future. We all want the Shopify's of the world.

Neil Patel (00:14:21):
Sure, but VCs don't give that much money to startups these days. If we're seed and the money isn't there. The most of the money is coming from Series B and C.

Pablo Srugo (00:14:32):
Sure. Yeah, yeah, if you're talking about the big money. Yeah, of course, at that point. The numbers are there and it's all about net dollar retention.

Neil Patel (00:14:37):
Correct!

Pablo Srugo (00:14:37):
Yes, and growth. That's right.

Neil Patel (00:14:39):
And when I'm talking about the big money, I'm not talking about a $5 million check. I'm talking about people writing $20, $30, $50, $100 million checks. In software, they want to see your upsells. Make up for more revenue than the contraction from the cancellations. And I look at business as, that's a bloody hard thing to achieve. You agree with this, right? Most startups do not, and a lot of it is just industry. Like, in marketing software companies tend to have terrible churn. Would you agree with this statement? Versus some other industries, like, software security. Has a lot less churn inherently. Do you agree with this statement?

Pablo Srugo (00:15:21):
Yeah, I think you need. I mean, it has to do a lot with the underlying. Like, if you're selling, let's say seats, and you're selling into an industry like software. That's a growing industry, then the odds are that if you retain them. Your customers grow with you, which is a huge tailwind. Same thing like a Shopify, you're selling to, you know, stores that there's a power loss. So the big ones will make up for it. But if you don't have those underlying elements, then. 

Neil Patel (00:15:43):
It's tough.

Pablo Srugo (00:15:44):
It's really hard to just keep expanding infinitely.

Neil Patel (00:15:46):
Correct. You got it. Okay, so the way we look at businesses. Why do I need a hip product market fit? You could say a product has product market fit, because people are really satisfied or not. But did you know if, because I'm assuming you're talking about product market fit based on the survey, right?

Pablo Srugo (00:16:05):
That's like one. That's one. I mean, yeah, the product fit is. Is kind of an ambiguous word. I think the survey is definitely one big indicator of that, you know, how fast you're closing deals. Maybe an earlier indicator of that retention is a later indicator. So, yeah, it's all ambiguous. Kind of a hollow term.

Neil Patel (00:16:20):
Sure. So, what my model is I don't need to hit product market fit. Take away product market and just give away a product for free. If you run the survey when the product is free, even if it's not as good as the competition. People are very satisfied because it's free. I'm just telling you the reality. You can go run a survey on a free product versus a paid product, and if the free product versus the pay product. They have the same features, but one's free. There's a big difference on how satisfied people are when they don't have to spend any money, and what I'm getting at is. What can you give away for free instead of focusing on product market fit? Which is really hard to achieve, and sell them on something else that's bigger. I'll give you an example that everyone in SaaS can relate to. You're familiar with Gusto?

Pablo Srugo (00:17:06):
Yeah, they were on the show.

Neil Patel (00:17:07):
You're familiar with payroll software?

Pablo Srugo (00:17:09):
Yes.

Neil Patel (00:17:10):
How expensive do you think payroll software is actually to run?

Pablo Srugo (00:17:13):
Probably not. I would say it's probably a high margin business.

Neil Patel (00:17:16):
It's not as cheap as most people think. Because there's, at least in the United States. There's different states, there's different cities, so taxes actually change for payroll on a lot of different variables. So the United States is a little bit more complex. There's organizations though that have this data and you can get it from them. And it's not the most expensive thing in the world. Now imagine taking that data and just having that as a sunk cost. And paying a monthly fee for it. If you gave away Gusto type features for free and people could do payroll for free. How popular do you think it's gonna be?

Pablo Srugo (00:17:54):
I think. I mean, I think there's huge power to free. So I would assume if it works, you know, close to as well. It, you know, it would do kind of its own. I mean, free is basically its own tailwind for marketing that's what I would say.

Neil Patel (00:18:04):
If I had the features of Gusto without the brand recognition at the beginning and I gave it away for free. Do you think virally over time I can grow to be more popular than Gusto?

Pablo Srugo (00:18:13):
I think there's a good shot at it.

Neil Patel (00:18:14):
I think there's a high probability. You agree with this, right? Assuming it's purely free.

Pablo Srugo (00:18:17):
I would agree with that.

Neil Patel (00:18:18):
With no strings attached.

Pablo Srugo (00:18:20):
Correct.

Neil Patel (00:18:20):
All right. Now, imagine, I can take payroll software and it's free. You're probably wondering, Neil, how do you make money? When a company provides payroll. What do a lot of people need who are employees at a company? Or what do they want? Payroll, you got to do payroll. But what do employees want in an organization, that's related to payroll?

Pablo Srugo (00:18:42):
Benefits? I don't know.

Neil Patel (00:18:44):
Yeah, what are some of those benefits?

Pablo Srugo (00:18:47):
Health? You're talking about health insurance.

Neil Patel (00:18:49):
Bingo! You got it right, okay. UnitedHealthcare, as we're filming this, I was looking at CNBC earlier yesterday or last night or this morning. One or the other, but I think the CEO just resigned for personal health reasons, okay. UnitedHealthcare, all right. So, UnitedHealthcare is a health insurance company, right? I'm trying to load up their stock price, it's loading slow. $285 billion market cap, you see here, UnitedHealthcare. But forget market cap because software companies have a higher multiple on profit than health care. Healthcare companies, insurance typically have a lower P.E. ratio than software companies. All right, not as sexy. So ignore market cap. Let's look at revenue. What do you think UnitedHealthcare does in revenue?

Pablo Srugo (00:19:36):
Dude, I have no idea. No idea.

Neil Patel (00:19:39):
$400 billion.

Pablo Srugo (00:19:41):
All right.

Neil Patel (00:19:41):
You see on the screen?

Pablo Srugo (00:19:42):
Yeah.

Neil Patel (00:19:42):
$400 billion a year, that was 2024. It was $400 billion, $400.28 billion, all right. Net income of $14.8 billion. It scrolled, all right, net income $14.8 billion. All right. let's look at Paychex. Have you heard of Paychex?

Pablo Srugo (00:20:03):
No, I haven't.

Neil Patel (00:20:05):
Paychex? The big software company, payroll software? All right, $54 billion market cap. All right, big software company. 31 is a P multiple. What do you think they do in revenue on an annual basis? Let's see, $5 billion in revenue.

Pablo Srugo (00:20:24):
$5 billion, okay.

Neil Patel (00:20:26):
Okay, profit of 1.69. UnitedHealthcare does more profit than Paychex does in revenue. So why not give away product and not try to focus on product market fit. And give it away for free, and get them to pay for something that is more valuable? Or something which has a bigger. Forget valuable, something that has a bigger market. You now have all these leads of businesses that are using payroll software, a portion of will pay you for health insurance. Much bigger market.

Pablo Srugo (00:20:59):
So a lot of this thinking. I mean, if I had to sum it up, is almost just a way of rethinking, like monetizing the lead versus the product. How to find opportunities where high margin, you know, because the software is so high margin. You can just give stuff away for free and make no money on the product. But then just find something else that has a higher kind of ARPU, and that's the thing that, and then whatever. Some percent pay you for that. It's still more than a hundred percent paying you, for the software itself. Plus you get the free kind of tailwind that you get from a free product as a result.

Neil Patel (00:21:32):
Yes, and this is why I think a lot of entrepreneurs get wrong. I'm not talking about just the Valley. I'm talking about in general. They read these books. They learn about product market. I know Sean Ellis, I have his phone number on my phone, you know, and I know all the lean startup stuff. I have Eric Reese's phone number on my phone. I'm not saying I know him exceptionally well, but I know him well enough where I can text or call him anytime. And when you look at a lot of this stuff, people try to optimize for product market fit, which is extremely hard. I think it's easier to build an average product, give it away for free, collect a lot of leads and sell them into something else where people in that space also pay for. And then now you got a cheaper flywheel than spending money on Google ads or, trying to do SEO or, social media marketing or anything like that. That's where I think people listening to your podcast should focus on instead of trying to optimize for the best public market fit. I think that's really hard to do, and this model can make you a lot of money. I run a nine figure plus revenue company, right? I haven't had a billion in revenue. But we passed nine figures a while ago, right.? So, when you think about it. You can make a lot of money doing things in an unconventional way that most people would never do.

Pablo Srugo (00:22:45):
So your plan would be, and I guess maybe you've done this. Just take a product that's already working. I mean, the Gusto example, and literally copy it. I mean, it's got to be one that's not so complicated that it's gonna take, you know, 30 engineers X amount of time. Because at some point, then you're gonna need a lot of money to kind of get that going.

Neil Patel (00:23:01):
Yeah, but these days you just use the API and stuff, and you burn the money. So you burn the money instead of on marketing, on the monthly fees to just make it free. There's so many credits for AWS and stuff like that. AI can help you, cursor all this kind of stuff can help you. But yeah, now it's even easier to do than when I started doing this model. Because when I started doing this model. I had to pay more for servers. I had to pay more for engineers. So now you can do this and don't try to achieve product market fit. Which is really hard to do, just give away something for free, collect leads and sell them on something else. Not sexy, you may not have an IPO that's like Uber. You probably won't with this model, but who cares? You're printing off cash.

Pablo Srugo (00:23:39):
Is there a hybrid model where you could, if you do want to be a SaaS founder, or software founder, and you don't want to be just selling off leads. Where you can think about. Take this Gusto example, giving away some for free and then still selling software, or do you think it's got a zero one? You either charge or you don't.

Neil Patel (00:23:56):
I think its one or the other, and I know I'm not the smartest person out there. I know at least in the Valley, people are going to follow the word of more Sequoia or Andreessen Horowitz more than me. And respectfully, so those guys have done better. They're richer than me. They've been doing this longer by all means. But one of them is either A16Z or Sequoia, they're now talking about service as a software. I don't know which one, but in the Valley, I'm assuming a lot of people are probably talking about service as a software. And what I'm getting at is giveaway software for free. Because service is a much bigger industry. Go sell them on services and go figure out how to use automate as much of that kind of stuff. And now you got your sexy company just in a different way of thinking. And you've got a much bigger market cap.

Pablo Srugo (00:24:38):
I like that. I mean, it's definitely unconventional. I haven't heard anybody else kind of talking about it that way, or at least. I mean, you know, freemium and giving stuff for free, and using kind of lead capture. These are common things, but, you know, going at, and I've also seen more and more, frankly, kind of copycat models, right? Where you just, you pick an industry, whatever, and you just do it and you charge less. I haven't really seen anybody doing it for free, and there's a huge difference between charging half as much as somebody and just making it free, like the power of the virality.

Neil Patel (00:25:11):
Very big difference, very big difference. Free is just free, and everyone always tells me, Oh, big companies don't care. Dude, when we make our products free and we have freemium versions, you know, a lot of our assignments are large corporations. So you're getting enterprise leads as well. And I was like, no, enterprises don't care and just pay the money. You want to know what the hardest part is if you work at a large corporation and you want to swipe software for $100 bucks or $200 bucks. Most people don't have credit cards, they need approval. 

Pablo Srugo (00:25:36):
That's procurement, yeah. 

Neil Patel (00:25:38):
Yeah, so they just go with a free solution. Because they can just get what they want really quickly, and it may not be as good. But they're, like, yeah at least I don't have to submit forms and try to convince someone to let me buy something on an annual subscription for a $1,000. When this corporation makes $20 billion a year. So it shouldn't matter. But I got to ask for approval, this is a pain. Let's just use a free product.

Pablo Srugo (00:25:56):
Makes total sense. Well, let me ask you something else just on. Just other questions I've had from founders around marketing and things like that. What do you think about your traditional kind of, let's say, paid versus word of mouth and attribution. All those kind of topics in the early days? How much did you care about driving referrals and word of mouth in the early days? Can you put it this way? Here's the question, right? Is it fine to grow purely on ads? Really early in your in your kind of zero to one journey for a long time.

Neil Patel (00:26:26):
Yeah, that's how most people grow. You're not going to go through referrals and word of mouth at the beginning. Most people don't know this, but branding really kicks in after year 10. Most startups don't think in 10 year horizons. But if you actually look at your brand name and its recognition within its category. For doing a good job in marketing, maybe 15%, 20% of people will recognize a brand within your industry after 10 years. It takes a long time. People are just very short-sighted, and that's when the word of mouth really starts kicking in. Just most people don't want to put in 10 years.

Pablo Srugo (00:26:56):
Is it worth investing then in branding? Because, I've got two schools of thought.

Neil Patel (00:26:59):
Yes.

Pablo Srugo (00:27:00):
You know, the ones that are really lean and the ones that are like, no, no, brand, brand, brand. I don't know which one's right.

Neil Patel (00:27:05):
You got to. Startups have their own, entrepreneurs have their own thought process on if brands good or bad. But yet, if I ask anyone whether they're an entrepreneur or not. And specifically the entrepreneurs, why did you decide to buy those Nike shoes? Oh, you know, they're comfortable, they're great. Everyone knows you just go with Nike, like, they have everything you need for athletic shoes, casual shoes. But why? I don't know, everyone just knows you just go with Nike. Do you Google for that Nike product? Do you click on an ad? No, I just know about Nike. Well, how much did they invest in branding? Am I right? Oh, you need an electric car. You want an electric car, maybe tax free. What one are you going to get? I don't know, you just get a Tesla. Did you click on a Tesla ad? No, you look in the valley, whether people love or hate Elon. People still drive a lot of Tesla's. He's built a good car. Do I think the seats are as comfortable as a Mercedes? No, but is this technology better than most cars? Yes, right? But it's brand recognition. He's been doing Tesla for a very long time. People forget that it's not a five or ten year old company. It's much older, and if you start looking at the companies that you purchase from, the products and services. Most of it's brand recognition.

Pablo Srugo (00:28:22):
How do you think about measuring that? Because that's one of the challenges. Again, like you said, most startups can't. They don't think in 10 years and they kind of can't. So, how do you deal with that? 

Neil Patel (00:28:31):
So you just go to Google Trends, google.com slash trends. You type in your brand name and you can pick whatever country you're focusing on or all countries. And you can do whatever time frame. And you'll look at the graph. And if your graph is going up and to the right, that means your brand is starting to become stronger and stronger. If your graph is saying it's flat or declining, that means you're doing a bad job with your brand building.

Pablo Srugo (00:28:51):
How long does it take to see results? We're talking months? We're talking, like, you have to do this for three years, before you start seeing stuff showing up on Google Trends?

Neil Patel (00:28:58):
You should see it within the first year. Within three years, it really kicks in. Within 10 years, you're starting to become decently well-known within a vertical. I get there's a Canvas and maybe some other people who may have done it faster than 10 years. I'm just telling you generally what it takes.

Pablo Srugo (00:29:13):
And so you would advise. Because, you know, the tradeoff is, do I do podcasts? Do I do events? Do I do the blog stuff? Or do I just say, like, not now. Let's do that stuff later, but you would say, kind of build that asset.

Neil Patel (00:29:26):
No, it all helps with branding. Whether it's TV ads or in-person event or podcast. It all helps. Pick and choose the ones that work best for your personality or the company. You can't do everything. It's hard to do everything, but that's how I look at it.

Pablo Srugo (00:29:39):
Got it, okay, cool. Well, listen, man, it's been it's been good. It's been good having you on the show. I think you definitely put out a new idea in that, maybe some founders will kind of actually adopt. In terms of, and I think if anything stretches out. How much stuff you might, what that line is, for giving stuff for free. How much should you be? Everybody, I think, understands it at this point.

Neil Patel (00:29:59):
Everything you can for free, as long as your costs aren't bloated. That's my philosophy, but look. I know when we did this podcast and scheduled it. This probably wasn't the direction you assumed that the podcast episode was going to go on. But I think this is an interesting take for your audience. That most people don't think instead, everyone's like, product market fit, product market fit. Instead of just, like, Hey, that's really hard to achieve. Just give away something for free and upsell them into something that's a bigger TAM.

Pablo Srugo (00:30:27):
I love it. Well, Neil, thanks for coming on the show, man.

Neil Patel (00:30:33):
Yeah. Take care.

Pablo Srugo (00:30:37):
You remember, like, the first person who told you about Bitcoin? The first person who told you about Uber? You want to be that person. Because being first is cool. So be a cool person and tell your founder friends. Send it to them on WhatsApp. Put it in a WhatsApp group. Put it on a Slack channel. Let people know about the show. Let people know about this episode. Don't let somebody else beat you to the punch and share it with your founder friends first. Remember what Ricky Bobby said, if you ain't first, you're last.