“Assuming timing exists, you [have to have] people, process, and technology…”
Zac Litwack is a partner at Savage Ventures, a venture operator with HQ in Nashville, TN which has created $450M in enterprise value so far. He recently led marketing for Savage portfolio company OutKick, which scaled to 7 figures per month in revenue and sold to FOX less than 1 year after its launch. He is currently Chief Marketing Officer / Partner of American Songwriter, Savage Sports, Rare, and 247Health whose properties reach 100+ million people per month, and is an owner plus leads growth hacking and high tempo testing across Savage’s portfolio companies, including MyDrHank, a 7 figure D2C online pharmacy and telemedicine brand focused on the senior male market, and Savage Media, a full-service creative service and video production firm. Savage Ventures has created $450M in enterprise value and is on a path to $1,000,000,000.
Questions and topics we covered include:
- The advantages venture operators have over traditional VC firms.
- The importance of people, process, and technology for a startup’s success.
- Do VCs look at a startup’s marketing strategy before making an investment? How much weight do they give to marketing when committing to an investment?
- How to build a marketing team from scratch.
- What does it take to scale a company from $0 to $100m?
- The most unaddressed marketing challenge all early-stage startups are facing.
- When is it appropriate to launch an affiliate marketing program?
- How to know if you have product market fit.
- How Zac’s businesses are preparing for new shifts in digital privacy regulations (he’s collecting first-party data!).
- How to find the right startups to work with as a marketer.
Say hi to Zac on LinkedIn – https://www.linkedin.com/in/zaclitwack/
Full Episode Transcript:
Kenny Soto 0:20
Hello, everyone, and welcome to the people Digital Marketing podcast with your host Kenny Soto and today’s special guest, Zach that wack. Hi, Zach, how are you?
Zac Litwack 0:34
Hey, Kenny. Thanks for having me, man. I’m excited to chat.
Kenny Soto 0:37
Likewise, I think there are a lot of places we can go with this interview. But I want to start off by just getting more context about who you are as a professional. So why don’t we start off with this? How do you get into the world of digital marketing?
Zac Litwack 0:52
Yeah, great question. Probably not an obvious route that you’re going to have on this podcast. I was a music producer for the first six or seven years of my career and noticed that I would produce these awesome records, and they weren’t getting promoted or released into the world. And so I dabbled in what I would call growth hacking, or like digital marketing pretty early on, like an example is trying to get placed bid on the big music blogs for some of my artists and so working I mean, you would call it SEO strategy today.
But it wasn’t really an SEO strategy. back then. It was just people who were using music blogs, kind of like how you Spotify today to discover artists and this was back in 2011 and 2012. And then I dabbled in some search marketing. For my artists. When Facebook opened up its newsfeed. I forget what year that was. I dabbled there.
But I was never doing digital marketing full-time. But I was I started to develop a love and passion for it. And I sold my music company in about 2015. And I didn’t really know what I wanted to do. Other than I didn’t, I knew I didn’t want to go back into the music industry. And so my friend called me, Daniel, he’s like, Hey, I heard you just sold your company.
Would you want to come to help me grow my app startup split? It was a restaurant technology app that helped patrons order from order food from their phone checkout from their phone and it connected to the restaurant’s POS honestly, it was way too early. If we did it last year, it might have worked out that timing is extremely important when you’re marketing products. But it got me into doing digital marketing full-time.
And I fell in love with startups, I fell in love with technology. I fell in love with running experiments and building websites and running, running experiments on every single channel imaginable for that particular business. And we failed miserably. I tried to do, I don’t know 15 or 20 more startups over the course of about a six-year period. They all failed pretty miserably, honestly. But I learned a lot from those experiences. And we started savage ventures about two and a half years ago. And now we’ve got a rocket ship. So it’s fun.
Kenny Soto 2:58
So you mentioned savage ventures, why don’t you tell us what you do today?
Zac Litwack 3:02
Yeah, savage Ventures is a venture operator. That’s what we call ourselves. So we’re part venture capitalists, we actually operate the companies we invest in. So we have operational control of the company as a traditional VC would invest in the companies and then maybe sit on the board, but act more passively towards giving guidance to the business. Whereas we’re doing the goal setting. We’re running the marketing experiments. For the most part, we’re building out the team. And so were heavily involved in the companies as the main difference.
Kenny Soto 3:28
What advantage do you think that gives you over the traditional VC model?
Zac Litwack 3:34
I think the advantage is, we can use capital more efficiently potentially, I mean, if you think about the traditional VC, they’re writing a three to $5 million check for like a Series A. And then they’re checking in on the business maybe once a month if they’re on the board. And they’re more passive, maybe even just once every quarter.
And so it gives us an opportunity to make quick decisions and an optimized kind of in real-time. And we only work focused on digital online businesses, we’ve got a lot of digital media concentration and direct-to-consumer. And within digital media companies, we do a lot of E-commerce. And so we’re running hundreds of experiments across the portfolio every week. So we’re able to prove stuff out super quickly and scale it much more quickly. I think then as a traditional VC could with their companies.
Kenny Soto 4:25
My next question, I did some research on some of the things you were talking about on LinkedIn. And you mentioned something called the savage system. What is that?
Zac Litwack 4:34
Yeah, the savage system is, I mean, we’re still formulating it, but I think any good product or company needs like four things, their timing, I mentioned that earlier, timing has to exist. So when we started splitting back in 2015, or whenever that was, we were just a little early for that type of business. DoorDash didn’t really exist yet. Uber was maybe just becoming a thing but not very realistic in a ton of markets and so for us to try to do that timing was just off.
For us to launch a bunch of digital media companies at savage ventures back in 2020, timing, the solid there a lot more people are online, people the world is it’s much more polarized. And so we were able to create content for specific audiences, and we got more eyeballs as a result and are able to grow the company. So timing has to exist, then, then, after assuming timing exists, you’ve got people process and technology.
So you’ve got to find the right people. And when you’re first starting a company, obviously, you need to wear a lot of hats. But as your company grows, you need to get better and better at finding other people that match your values and want to grow the company with you. And so we find, you need the right people around you to scale the company.
The second one is processed, we’ve got a couple of core processes. Right now we do goal setting via our oak OKR framework, it stands for objective and key results. And then the way we achieve our objectives and key results are we run what I call high-tempo testing, which is basically a process to run as many marketing experiments as you can, during a weekly sprint.
And you learn that way you learn much faster, and that would affect the OKRs. Much in a much deeper, you know, a richer and more efficient way. And then you’ve got the technology piece, and we’re not at savage ventures, we don’t create technology. But we leverage technology. So we leverage Facebook’s algorithm, we leverage WordPress, and we leverage Asana to actually run the high-tempo testing process I just mentioned.
So at every step, we leverage Zapier, and you know, all sorts of marketing tools, Active Campaign play, view, etc. To make our company more scalable. And so if you’ve got those three things kind of dialed in, and you assume the timing component is there, your company is going to grow. For sure. I don’t know how fast it’s gonna grow, but it will grow and you’ll create some wealth, and you’ll have some you’ll, you’ll create something, you might not be a unicorn, but it will work if that makes sense.
Kenny Soto 7:14
You have a unique perspective that I want to tap into because I’ve always been curious, from the venture capital, this perspective, how important is a company’s marketing? When is their seed? Maybe Series A, let’s have that as the context? How important is marketing in terms of people and processes as two factors? Does it have any weight at all, when it comes to making an investment?
Zac Litwack 7:42
Yeah, totally. I think the biggest mistake startups make is they spend way too much time on strategy. And don’t just show the product to more people and get that feedback loop going, you can do that through what I mentioned earlier, how to protect him, but in a less refined way, you could still show the product to as many people as possible and just take that as your strategy and get feedback.
And that’s a much better approach than working on a strategy that’s like 30 pages long because ultimately, your strategy is not going to be right. It might be directional. And so for our company’s doing less than 10 million per year, we actually just do like a one-ish page doc, that just states our goals, both qualitative and quantitative. And then underneath that, the priorities that we want to focus on to hit those goals.
So a priority could be like, we want to scale, you know, e-commerce around this brand. And we want to implement affiliates in this brand. Like basically, the priorities would be different revenue streams, we want to test. And then underneath that is the personnel, the people we need to actually execute the strategy.
That’s it. And so we do that, then we take all that into the OKR framework I talked about, then we start running experiments. And that way we just learned quickly, like all that could have happened in just a few weeks periods. And we’re off to the races. So yeah, it’s in when we’re looking at it from a venture capital standpoint, I mean, savage ventures, we’re looking for stuff that that has product market fit.
So it’s got the timing, and they’ve got some initial traction, for sure. And you can’t get that initial traction unless you start to actually market the product. Don’t worry if that like finding your minimal viable product and showing it to as many people as possible would be my one bit of advice to any startups out there.
Kenny Soto 9:26
Let’s My next question is, is really focused on the person who might be like the first marketing hire, and they’re being groomed for VP of marketing or they’ve had experience in a leadership role in the past? What does it take to scale a company from $0 in annual recurring revenue to 100 million?
Zac Litwack 9:48
Yeah, good question. I think keeping it simple to start, don’t spend too much time on strategy and start to just read those marketing experiments so that you can get that in that additional feedback, if you’re a young marketer joining us, like you’re the first marketer at a, at a startup, assuming there’s product market fit, I’d say make sure that you’re the founders are bought into high tempo testing or some sort of experimental approach to growth, and make sure that they understand that 90%, maybe even more, when you’re first starting out, 90% of the experiments that you launch aren’t gonna work out.
But the 10% that do will certainly pay for the other 90%. I’m trying to think back to like my first startup, like a marketing job where I was kind of the VP of marketing. And I remember the CEO of that company, he came from Silicon Valley. And so he was already kind of aware of the high-tempo testing methodology. And he was aware of, of, you know, general growth hacking and growth topics.
So that was helpful for me because I was able to come in, and, he embraced it super quickly. And so just getting everyone on the same page, as far as like, this is what we’re doing. This is what these are, you know, our priorities. And this is, this is the process that we’re going to implement to hit our goals. It’s called high-tempo testing, or whatever name you want to call it, and get them involved in the process. So the way we do high-tempo testing is, we have a weekly what we call a growth meeting for each business.
And that’s where we review all the experiments that we ran in the previous week and pick the experiments that we’re about to run. And so get it, there may only be like a handful other employees, like get everyone involved, get the salesperson involved, you’re the marketer, get the CEO, and both get even the technology person involved into the process, you’re asking 30 minutes of their time, every week, it’s not a big deal.
And I think eventually, they’re going to see the value in it, it might take some, it might take a while just like anything that’s worthwhile in life, eventually, they’ll see the value in it, they’ll embrace it, and you’re gonna grow the company faster as a result.
Kenny Soto 11:49
Let’s talk about the marketing team. Because it’s such a vague concept when you think about it, regardless of whether or not there are different industries or different business models, just the person who’s leading the team can construct it in a different way compared to other people. When you’re thinking about building a marketing team from scratch, how do you organize the functions?
Zac Litwack 12:12
That’s a good question. I always like to have somebody and this is some advice, I think, for your younger marketers, and maybe I’m biased because this is the path that I wanted to take. Actually, I listened to a couple of episodes, Kenny, and this was like a hot discussion or hot topic. I always like to have somebody that I call a full stack marketer, where they have a lot of, they have wide experience. And in some cases, it’s deep.
And that’s kind of what happened to me when I gained this full-stack experience. I’ve done, you know, paid media, and grown or channels organically and almost every channel imaginable, from Facebook to Instagram to I mean, tick tock now, but like, I mean, read it, like everyone read it ads, like I’ve run Pinterest ads, I scaled a Pinterest in organic. So every business is different, obviously. And so whenever your channels are selected for business, you really want to focus on like one at a time, really starting out.
And so I like to have a full stack marketer on the team just because they’re usually more technical, too. They’ve usually like built websites before they usually, you know, use Zapier to like, tie some stuff together, they digitally, you know, built a CRM for like a b2b business like so they’re like somewhat familiar with Salesforce, just finding somebody like that is super valuable, at least in my mind is like a Chief Marketing Officer of a bunch of companies.
And then that person, in some cases could be like the growth Master is what I call them, that leads those growth meetings and leads that tempo testing process. And then as we learn as a company grows, you really see what’s working really well. And then I usually start to hire specialized roles. For example, we’ve got a handful of digital media companies.
And so having an SEO expert or just an organic, we’d call it to start Ganic. And referral experts are super valuable. And so we’ve got a great SEO expert named Ethan, who has a ton of experience in digital media and has built a kind of a playbook for us on how to get us, our media company’s content into the organic ecosystem, both from a search perspective, and from a Google discover perspective. And that’s been really valuable. Whether his role group grows or not, is really up to him.
But yeah, so I guess it’s starting full stack and then filling them with specialists and then figuring out what the specialists want to do if they want to just continue going down that lane or if they want to gain more experience, and then you evolve their role from there.
Kenny Soto 14:39
And as far as like how you organize the departments, would you say it’s a mixture of brand performance growth, revenue, if you will, as another department, and content, or is there another way that you would organize the team?
Zac Litwack 14:58
Yeah, I mean, you would probably Don’t like silos. And so I think of it all as like one cohesive team. And you would need to pull in like most of your marketing team, if not your whole team, even if your team was pretty large, like 1520 people I would consider is pretty large, like, that probably means you’re doing, you know, over $5 million in revenue at that point, I would imagine,
I still pull everybody into that high tempo testing process, that growth meaning process, and I would still want everybody to run that process together, because the more minds that are in that, in that Kanban board, the better we’re going to be as a result, and when you get people across marketing disciplines in the same room, it usually has a great usually evolves into an amazing brainstorming session, and you end up adding five or 10 ideas that could that when one will make you like a million bucks, you know, that next 12 months.
And so regardless of how you develop it, pull everybody into that high-tempo testing process. I’m not a huge fan of creating different departments in general for that reason. I think though if you’re over like $10 million in revenue, you’re probably going to have to have maybe two or three small teams, and I think it’s highly dependent on the company, I’ll tell you how we do it, like for our companies, so we’ve got, I would say, like our technical marketing team, so we’ve got some paid media, folks, we’ve got our, our full stack marketers, you know, we’ve got some special specialty people in that group, like that SEO person I mentioned earlier.
And we’ve got like some social media, you know, content experts in that group. And then we also have, I guess, you can consider this under the marketing umbrella, we also have our editorial team for all of our digital media coasts. So like, those are the writers, the leader, so they’re posting to, you know, the website, they’re blogging, essentially, you know, every day, then so those are the two Those are, those are two, I guess, teams.
And then I would say that third team would be like, that you hit on it earlier would be like that brand PR team. That’s, that’s usually doing it across the portfolio. But there are different strategies for each of our brands.
Kenny Soto 17:05
This can be in the context of this year, but also from your past experience. What do you think is a very common, but sometimes unaddressed marketing challenge that a lot of startups face during their first year of operations.
Zac Litwack 17:24
Trying to do too much shit, like just pick one, or pick one channel, potentially, if you’re just if you’re really young, and just, like, own that channel, and it will be much easier to build other channels as a simple example. I don’t think you should have any more than like three priorities. If you’re just starting out, just keep it simple to start at what is it kiss, like keep it simple, stupid, or stupid, simple or whatever? That I mean that really, you should do that at all levels of your business. But especially when you’re first starting out. And you don’t know much.
Kenny Soto 17:57
Let’s assume that I’m operating a startup. And we’ve already identified that affiliate marketing and affiliate marketing programs would be very beneficial for the business. When is it appropriate to launch that program and what needs to be set up prior to the launch for it to be successful?
Zac Litwack 18:18
Yeah, there are a couple of ways to approach that. There are exchanges like impact radius, and there are three or four other ones that you can basically apply to, and basically, they’ll run the technology component of your affiliate program. And there are also other publishers on the platform that, you know, can take it, take your car, if they want to promote you, as they can just say, Yes, I want to promote you, and links are created.
And then they’ll write content, you know, around you based on your guidelines. So I view affiliate strategy as this, there’s, there’s an influencer, part of the strategy, and maybe you actually have a different like whole other strategy for influencers. But there I see influencers as like, could be champions for you and drive affiliate revenue. And then I see publishers as the other side. So that’s like the con, that’s the like, blog or content side of things.
And so if the scratch probably of both, and I think influencers are just content creators are going to become more and more important as we venture into this world of, privacy, and our landscape or digital marketing landscape is going to look a lot more like Europe’s looks today, and two or three years. And so whether you have someone internal that actually like becomes an influencer for your brand, or you leverage other influencers that really like your product, I think that DCA is a part of your strategy.
And you should probably prioritize that earlier and earlier. I think if your company has a product market fit and you know a decent amount of customers, I would start to engage my publishers and up-and-coming influencers as part of your affiliate strategy.
Kenny Soto 20:05
You’ve mentioned it twice already. And I think you can give some more insight into what it actually looks like: what are the signals? Can you give a more clear definition of one product market fit? And then what are the signals that someone can look at to know whether or not they have it?
Zac Litwack 20:24
Yeah, there’s almost this intuitive thing that happens, especially after doing this for a long time, where your product is almost growing without you really having to try. Like we’ve got a newsletter business right now called the daily tonic to health and wellness newsletter. And it’s like taking, you know, science-backed research and news and tips, but delivering it in like an easy-to-consume and, and honestly, kind of funny and entertaining way.
And the thing is just like, I’m not really doing much, and people are just referring to their friends and it’s growing. So that’s kind of that, that’s at its core product market fit. It doesn’t have to be like a, you know, a physical product or even software, like a newsletter. It’s whatever business you’re trying to grow.
And so when there’s like virality, and growth, without you really, really need to try very hard it is what I would consider product market fit at its core. And then you can look at other things like okay, you know, how many customers do you have, and stuff like that. But at the end of the day, if growth is happening without you having to try that hard, and then it doesn’t matter how many customers you have to take, you can add a lot more tomorrow.
Kenny Soto 21:36
Three more questions for you. Let’s tie back into what you mentioned earlier about America’s privacy landscape looking a lot more like Europe in the future. What are your businesses doing now to prepare for that inevitable change?
Zac Litwack 21:53
It’s always important to diversify your business. But we’re, we’re even more focused than ever on diversification. A couple of things happened to us last year. And I’m sure this happened to some of your audience, especially with Facebook’s, you know, algorithm that was changing on December night, where it was super easy to get a three-row ad like the top of the funnel for like really good products, you know, a really good offer. It was like, all of a sudden, we were having trouble squeezing out like a 1.5 rows top of funnel or maybe one row.
So it happened pretty quickly to us. And it was a wake-up call for one of our companies where we weren’t really diversified that well, we were heavily reliant on Facebook. And so getting more diversified is really important. Collecting more first-party data is extremely important right now. And so it’s interesting how it kind of naturally happened. But all of a sudden, we’ve got some like newsletters, businesses have that in their own right inside of our digital media companies.
And I don’t know if that was like, at the back of our minds or deep down, it was actually because of this conference, this topic. But we’ve got a lot more first-party data than ever, then I would say your brand is going to become extremely important. And so being more focused on your brand, and actually, like allocating maybe a little bit more budget, I’m like a technical performance marketer at heart, but even at like, allocate a little bit more your budget to get your brand out there honestly might be a good thing to do.
And then I would say, figuring out like affiliate and influencers, because if you develop really rich partnerships with companies that like to promote your product, then no matter if you can run paid media or not, at that point, like it doesn’t matter if you can run paid media, you’re not effectively at that point. Because you’ve got these influencers with these massive channels, and these publishers with these massive distribution platforms all promoting your product, it doesn’t matter.
Kenny Soto 23:40
You’re the perfect person to ask this next question, because of your startup experience, if someone is currently working in marketing, but they’re in like a bigger corporation, and they want to get into the startup landscape. How should they evaluate potential employers?
Zac Litwack 24:01
Yeah, I mentioned it earlier. But if they already have like, this concept of experimentation kind of mapped out, and it’s something they really want to deploy. I’d say that would be a good start. And if you’re in a big corporate now and you’re not, you don’t have kids, you’re not married, maybe you even are married work nights and weekends with a startup. If you do it for, like, borderline free.
They’re gonna say yes, I mean, we do it all the time. Like to have our two of our like, what I would call like, most experienced, like, you know, best marketers right now started working for, you know, like minimum wage with us just to prove themselves and now they’re making a ton of money. And so it’s, it’s in but in both cases, they had a day job.
One actually had a day job that wasn’t even in marketing. He was an x professional tennis player, and he was coaching tennis. And so but he really had a passion for E-commerce and digital marketing. And so basically, we paid him I mean, Essentially, you know, minimum wage so that he can learn and grow and prove himself. And now he’s a fantastic marketer. And in just a couple years, he’s got as much experience as a lot of like six to 10 year, you know, people we talked to.
Kenny Soto 25:13
My last question for Zach is hypothetical because time machines don’t exist. But if they did, and you go back in time, specifically 10 years since the past, knowing everything you know, today, how would you accelerate the speed of your career?
Zac Litwack 25:29
Yeah, well, I had an opportunity in the music industry that I didn’t take advantage of, probably around 10 years ago, where I had I started having initial success, we produced a couple of records that were doing really well that had product market fit and morality, all that stuff I talked about earlier. In one case, we were really early to YouTube.
And then the other case, we were actually early to Spotify. And so Spotify we were featured on like all the Spotify playlists in Spotify was just ramping up. And I kind of freaked out, as I paused and I didn’t take, I didn’t leverage that timing effectively. And as a result, the company ended up just kind of not dissolving. But I ended up selling my share to my business partners. And, and, and I’m grateful for that because it led me down this marketing path.
But yeah, if I go back 10 years, I would, I would actually leverage the unique timing. And kind of I mean, getting a little lucky that I had with these two artists, who would probably be I mean, not sure I would be wealthier. But the thing Kenny, I don’t know if I’d be happier.
Kenny Soto 26:39
Got it. Sometimes it’s good to go through the path that you went through because you were just meant to go through it, essentially.
Zac Litwack 26:45
Yeah, I learned a lot more lessons, that’s for sure. It probably could have been more successful earlier on. But I think all the startup failures I mentioned earlier, and even going through that experience in the music industry, taught me all these things that I’m now using the savage ventures and I think that the result is pretty fantastic.
Kenny Soto 27:04
That’s a perfect way to end this. If anyone wanted to find you online. Where can they go to say hello?
Zac Litwack 27:09
I am not on social sites just because I’m on social media for companies all the time. But I do get on LinkedIn. I think that’s where we connected. I’m on LinkedIn exactly where x savage dot Ventures is the website. I’m always happy to chat with marketers. We hire quite a few every month. And so I think we’re pretty fun people to work with. So yeah, reach out if you want advice on your career, want to see ah, maybe you want to work with us or anything LinkedIn would be the best way to do that.
Kenny Soto 27:41
Perfect. Thank you, Zach, for your time today. And thank you to your listener for listening to another episode of the people Digital Marketing podcast with your host Kenny Soto. And if you haven’t done so already, please subscribe on whatever podcasting app you’re listening to and rate us for five stars ideally. And as always, I hope everyone has a great week.