The Story of Long Tail Pro: How I Built a $100,000 Software Business from My Own Needs

The Story of Long Tail Pro: How I Built a $100,000 Software Business from My Own Needs

Its time to tell the story of Long Tail Pro.

As the creator of Long Tail Pro, I’ve discussed some of the ups and downs of owning a software business, but I’ve never divulged all of the details that have made this side of my business what it is today.

Some of what I discuss below, were some of the hardest decisions I’ve ever made.  Now with “20/20″ hindsight, I’m able to see what I did wrong and what decisions I made that were absolutely right.

I can’t promise you that reading this will lead to your own six figure software business, but I think there are some valuable lessons hear that any entrepreneur could learn.

However, the results for me have been huge.  I was able to find a problem I had, built a software product that met my own needs, sell it to others, and generate over six figures during its very first year.  (I have big plans for the future as well as you will see from reading below).

How I Found My Big Idea

I’ve been an avid keyword researcher since about early 2009.  Before that time, I did a little bit of keyword research, but nothing significant.  In late 2009, I decided to build lots of small niche sites (seeing some success from my early experiments).

In fact, it was these small niche sites that eventually led me to quitting my full-time job in March 2011.  That was the first six figure business that I built – small niche sites and Google Adsense.

However, in the process of doing keyword research for all these niche sites, I quickly realized something. I was spending TONS of time (hours each day) researching keywords.  I was primarily using Market Samurai and the SEO for Firefox plugin to generate keywords and analyze the competition.  What a tedious and slow process!

Now, don’t get me wrong, Market Samurai has some great things going on, but speed is not one of them.  Here’s how the process worked back then (and still does) with Market Samurai:

  • Input ONE seed keyword.
  • Hit “Generate Keywords”.
  • Wait 3 to 4 minutes while the data is pulled in.
  • This only generates the search volume data.  If you want more you have to hit “Analyze Keywords” to get the CPC data.
  • Wait a couple of minutes to get CPC data (or other data as well).
  • Then input filters to narrow down the keyword list to what you actually want to see.
  • Export keywords and paste into a bulk domain checker to see if Exact Match Domains are available.
  • Analyze the top 10 competition if the domain is available.
  • If none of these keywords fit, start the entire process over with on ONE more additional seed keyword.

This process easily took 20 minutes of more just to look at one seed keyword.  I usually had to go through a half a dozen or more seed keywords to find one good keyword.  So, it was entirely possible for me to spend 2 full hours of intense keyword research before I found anything worth going after.

To say the least, the process was painful!  (And I’m not trying to make Market Samurai look bad, this is essentially how ALL keyword tools worked – and they just happen to be the one I was using at the time.  Overall, I think Market Samurai is a good keyword tool).  I list out all these steps to help you understand the pain I was going through as I tried to complete my keyword research.

You also have to realize that I was doing this late at night or early in the morning after working a full-time job…I didn’t have time to mess around!

To see a timed comparison of Long Tail Pro vs. Market Samurai, check out my video here.

Well, after over a year of doing keyword research this way, I decided to look into what it would take to build my own keyword research tool that met my needs.  (By this time I was doing pretty well with Google Adsense and was just about to quit my full time job.  So I had money saved up.)

This was about October 2010 that I started looking into developing my own tool.  So, out of my own frustration with how painfully long keyword research took, I decided to build Long Tail Pro.

From Idea to Product

I should make very clear that I am NOT a programmer of any kind.  My background is in banking and finance.  I couldn’t build the tool myself, so I hired someone.

I actually went to a few different “freelance” websites and posted a job for what I was looking for.  The range of cost in various programmers was significant.  I decided to go with one of the cheapest programmers, which turned out to be my first mistake.

I figured well, this programmer is promising to finish the project in a couple of months for $x,xxx dollars, and I’m not required to pay unless I’m satisfied with the work…right?  So, I hired someone outside that US that spoke very little English…but he was CHEAP!

To get the product created, I detailed exactly what I was looking for and showed him some other keyword research tools that had similar functions for him to reference.  Overall, this first programmer actually did a pretty good job and got me a completed product pretty quickly!

I figured, that the hard part was over!  I have the product, now I just need to sell it.  The on-going maintenance of the software was an after-thought.  Boy was I naive!

From Product to Sales

With completed product (or so I thought) in hand, I began selling that first version around January 2011.  My process of selling was pretty basic.  I had a blog, so I essentially sent an email to my blog readers and made a post telling everyone that it was available.

I also ran a WSO (Warrior Special Offer) on the Warrior Forum.  Both of these generated enough sales for me to make my money back pretty quickly.  Although, that’s not saying a whole lot since this first version cost me less than $4k to develop.

I was receiving great reviews on the speed and overall concept.  People LOVED the fact that you could finally search for multiple seed keywords at once AND automatically search for exact match domains!  The product basically sold itself…because I didn’t have a huge list or do much marketing.  I was making a few thousand dollars a month for the first couple of months…sweet!

Here is one of the early box shots from the Long Tail Pro (pretty ugly, huh?).

However, after only a couple of weeks, the software stopped working!  What the!?!  How is it possible that a piece of code could stop doing what it was programmed to do?  It was in a for a rude awakening called “software maintenance” and also learned about my big mistake and several others that I had made.

My BIG Mistake (and several small ones)

Well, I contacted my original programmer telling him that the software stopped working!  He then informed me what was going on.  Essentially, in order to pull data from Google, check exact match domains, and the MANY other resources we were querying could affect software performance.  It wasn’t that the Long Tail Pro code had stopped working, it was that perhaps Google had tweaked ever so slightly how they were displaying search results, or something else had changed from the dozens of places we were looking at.  Any small change would cause the software to stop functioning properly.

This programmer was gracious and fixed the first couple of issues to get Long Tail Pro back up and running.  But I was beginning to find it difficult to work with someone that didn’t speak English well and was in a different time zone.  I decided I wanted to take the software code and hire a different programmer that I could work with better.

This is when my programmer stopped co-operating.  He refused to hand over the source code.

This is a big deal, because without the source code, I was 100% reliant on this programmer and could never hire someone else.

Now, when I went through the freelance website and posted my original job, I assumed that the source code was part of the deal.  However, this programmer refused because I hadn’t explicitly laid it out in the original job description.  This was my BIG mistake!  Yes, I probably could have contacted the freelance site and submitted a dispute.  However, this was likely to take a very long time, and I needed to have my software maintained.

So, I asked the programmer how much he would sell the source code to me for (which I thought I had already paid for).  He said it would cost $15,000!  Ouch!  You have to realize that this was about 5 times what I had already paid him.  So, while I thought I had already put forth my big one-time cost to get it programmed (about $3k or so), now I was smacked with the reality that I was going to have to pay WAY more to keep selling Long Tail Pro.

So, if you ever start a software business – make sure you own the source code!  The other small mistakes I made was not understanding the ongoing costs of software maintenance.  Finally, I leaned that a “cheap” programmer is probably not a smart move.

Close Shop or Change Course?

So, here I was only 2 months after I started selling Long Tail Pro with a major decision to make.  I could either shell out another $15k to get my hands on the source code or I could just shut down the business altogether.  Well, in the end, I decided on a third option: Start from scratch and hire someone AWESOME!

You see, with this “cheap” first version I was able to test the market.  I knew there was a hungry market for a faster and more effective keyword research tool.  I really saw the upside potential.  However, I had severely underestimated the cost and time commitment it would take.

So, rather than pay $15k to get the original code and then hire someone else (additional costs) to “fix” the original code, I decided to hire someone and let them start from scratch.  This time I decided to hire the absolute best I could find, regardless of price.  I wanted to invest in the quality and longevity of Long Tail Pro.

I was lucky to find an EXCELLENT programmer based in the US that was very willing to work with me…and was just fine giving me access to the source code :).  I really felt more like I was taking on a partner at that point.  I won’t say exactly how much getting that second version of Long Tail Pro cost – but it was more than the $15k I would have spent to get the original code.

This was about March 2011 – right when I was quitting my job.  I had saved up quite a bit over the previous 2 years, so I felt like this was a good investment in my business (and it was).

Getting this second version of Long Tail Pro took a few months to get up and running in beta form.  In the meantime, I worked with my first programmer to constantly maintain the first version of Long Tail Pro.  I didn’t tell him that I had hired someone else to create a second version.  Maintaining that first version was very difficult, and I admit there was a lot of downtime for those original purchasers of the software.  However, I was doing my best to put out something to replace it.

Decision Validated!

So, it wasn’t until about June of 2011 that I finally released the beta version of the Long Tail Pro that you see today.  I immediately gave all existing users of the original Long Tail Pro free lifetime access to this new version of Long Tail Pro.  I also started selling it to others at a discounted price for those willing to get in at the beta level.

The difference between these 2 version was night and day!  The old version looked like an excel spreadsheet (ugly), the new version is beautiful, has a nice workflow, and best of all…it works better!  And now I can work with my programmer much easier, he’s more responsive, and overall, is highly effective.

However, the real validation came with the sales.  I sold the “beta” version from June until October 2011.  Then in October I launched the standard version.  By this time, I had a bigger following on my blog, and had a few affiliates behind the product.

Again, I didn’t have any major “launch” events other than what I did here on my blog, email list, and on forums.  With the bit of marketing I did, and an exceptional product, I was able to make all my investment back and then some by the end of the year!

My decision to fire my old programmer and hire a new one (even though he is much more expensive) has been validated.  Its been about a year since I officially launched Long Tail Pro in Oct. 2011, and the software has made over $100,000 in revenue since that time.

The Future of Long Tail Pro?

So what’s does the future hold for Long Tail Pro?  Well, as I’ve posted recently here (watch video), I’ve added some new “Platinum” features that are currently being beta tested by users.

I am continuing my vision to make Long Tail Pro the most effective and fastest way to do keyword research.  One of the new features is the ability to analyze the top 10 results in Google much quicker.  Now, the software gives you an overall “keyword competiveness” number based on the search results in Google.  The lower the number, the easier it is for you to rank.

It really is that simple.  If you want to check out the keyword competitiveness in action, watch this video.

Other new “platinum” features include: saving favorite keywords, importing up to 10k keywords at once, and more.

This Platinum version of Long Tail Pro is launching on Dec. 11th (next Tuesday).  Don’t worry existing Long Tail Pro users, you will always have access to the great features that you love about Long Tail Pro without any requirement to upgrade.  Long Tail Pro will always be updated and maintained as it always has.  If you decide you want the new Platinum features, you’ll have the chance to upgrade in less than a week.

In Conclusion

Overall, the story of Long Tail Pro is one that I felt like I needed to share.  I can definitely say that its been a big part of my business; and although I’ve had my ups and downs with it, overall its been a great investment.  In addition, when I had my Google Adsense Account banned in April, knowing that I still had income coming in was nice.  (I got a new Adsense account in June, and its been active ever since).

If you are considering getting into the software business, I recommend it…with caution.  The process can be long and difficult and also very expensive; but, if you create a great product and market well, there is a lot of upside potential.  I’m far from the most successful software entrepreneur, but I’ve had a taste with Long Tail Pro.

I would love to hear your thoughts, comments, or questions that you might have below!


How Long Tail Pro Can Help You Capture Way More Search Engine Traffic

If your business could benefit in any way from getting more search engine traffic, I have some good news.

Search engines are in love with long tail keywords! If you are able to provide relevant content targeting these long tail keywords, then you can see a dramatic increase to the amount of traffic Google and other search engines send you.

Long Tail Pro is a powerful keyword research tool that makes finding these valuable long tail keywords a breeze.

What are “long tail keywords”? Essentially, these are words or phrases that people type into the search engines to find very specific things. Rather than searching for “dog training” a user might search for “how to potty train a pitbull”.

This is an example of a Long Tail Keyword. To visualize how Long Tail Keywords work...

Click to Continue Reading


42 Comments for this entry

  1. Willox Perez says:

    Incredible story Spencer!

    Being one of the people who was there for both versions and when you got started with it I definitely saw the progress and the effort on your part.

    It truly shows the power of investing your income in other streams as it helped out a lot when the whole Adsense banning happened. Omar and I were on the same boat and it was a big lesson learned.

    Thanks for the share and the continuous inspiration!

    -Will

  2. Great Article Spencer. I could relate to a lot of what you went through.

    I’ve had similar problems with developers in the past because I went the cheap route. I remember developing a unique domain script in 2001. It was a simple script that listed domains for domain sellers. It proved really popular on forums like dnforum.

    I later found that the developer had sold it to a turnkey website and I found my ‘unique script’ across tens of thousands of websites on the web. He refused to answer of my emails.

    I had problems with WordPress designers too. After they designed a theme for me I saw them release other designs which were 99% the same thing.

    At the end of the day, you get what you pay for. It’s usually better to pay a fair price so you don’t get screwed in the long run.

    Kevin

    • Spencer Haws says:

      Thanks for the thoughts Kevin! In a way, its good to know that I’m not the only one that’s been through programming issues… But you are right on, its usually best to hire based on quality rather than price.

      • Yeah the hiring of coders can be pretty cuthroat on freelance websites. There are some good developers in 3rd world companies but many do cut corners. Tactics like refusing to give back the code is just despicable.

    • Muzi Mohale says:

      Kevin, I miss your wordpress insights since you sold wpmods…are you not launching another wp blog?

      • Thanks for the kind words Muzi. I do have plans to launch a brand new blog in 2013.

        I’ve not worked much over the last 3 months as I’m backpacking around South America. Did Peru, Bolivia, Chile, Argentina and Uruguay, Came back to Colombia for a month (I lived here for a year last year) and then I’m heading onto Rio in Brasil on January 1st.

        At the moment I’m working on my personal blog a little and will occasionally post WordPress related things there, however over the next few weeks I hope to finish a book about successful freelance blogging. I’ll see how that goes and then plan out my next steps. I’ve done tons of research on three different blog topics but I just need to decide which one is the most viable to develop long term.

        :)

  3. Hey Spencer.

    You never cease to amaze me with all the stuff that you share. Great stuff. Happy to see you’ve made some good money with your Software. You found a need in the market place…and you filled it.

    That’s what business is all about!

    Also, I like how you mentioned the adversity that you had to overcome as well. Man…sometimes it can be so hard with all the roadblocks that come in the way. But you didn’t let anything stop you.

    I hope you shed inspiration on everyone out there who may need some.

    Thanks Spencer!

    -Omar

  4. Jon Haws says:

    Wow Spencer I had no idea you had dealt with all that. . . to be honest it makes me want to take another plunge on some business ideas. If you could handle that while keeping your customers happy . . . so can I!!!

    • Spencer Haws says:

      Yep, I have told too many people about all the issues I had early on with Long Tail Pro. If it inspires you to try out some a new business ideas…I’d love to hear about them :)

  5. Aaron says:

    Hey spencer,

    Thanks for sharing your story with us.
    I love the long tail pro platinum version, especially the newly added feature KC. I will upgrade to the new platinum when 11th Dec. comes.

    Here is some suggestions from me if you think it is helpful.
    The imported 10k keyword list is helpful. Right now, we have to manually click on the kc button to obtain the KC value. Wouldnt it be great if we can import a whole list of keywords, and let the program run to generate the KC value. We can then export it as csv with list of Keywords with KC value, and make our decision on keywords chosing based on the list.

    Not sure if this is going to be server intensive. We are using our own SEOmoz API key right? What if we are no longer PRO account with SEOmoz? Would we still be able to calculate KC value?

    Another suggestion that i had, well this is mainly for me. -.-Would you be able to add location New Zealand as part of the software analysis? I see you have location NZ on the add new campaign but you dont have NZ on the competitor analysis on the drop down list.

    Thanks spencer, keep up the great work!

    • Spencer Haws says:

      Aaron – you do not need any type of paid SEOmoz account to get the KC value. So, if you cancel your PRO account, you can still get KC values. You just need the free API…so you’re fine. Pulling automated KC values is something we would love to do and may in the future.

      Finally, yes, we can consider NZ on the comp analysis.

  6. Thanks for sharing your story! I was impressed with the functionality of long tail pro and figured you must have had some coding background but its even more impressive seeing how you created your first version so inexpensively!

    I have outsourced some small very specialty software and was able to live with the bugs but to get to a polished finished project is very difficult! Good for you.

  7. Very cool Spencer! Yeah, getting ownership of the source code is key, and something I need to make sure I do for Yakezie.com v3.0.

    Here are my questions for you:

    * Is there a point where you can stop building niche sites and just sell software? Software is much easier than building site, especially in this Google world?

    * How are you adapting your product for the Google algorithm changes? Or, does it not better as keywords are keywords?

    * How could an established blogger benefit from using your product? For example, I know what I love to write about on Financial Samurai, and therefore hope to do well in the key words I’m most interested in. Is the tool supposed to help me find derivative keywords that I could not have thought up on my own to generate more traffic? I’m thinking of becoming an affiliate.

    Thanks!

    Sam

    • Spencer Haws says:

      Sure, I could focus on selling software only BUT I really enjoy building sites and I find value in teaching others what I learn. Finally it helps me understand first hand what keyword researchers are looking for (because I do it myself).
      Google changes – the software pulls in the top 10 results so you can analyze them. Many of the metrics are based on SEOmoz Page Authority, MozRank, and more. SEOmoz does a VERY good job of updating their authority formulas based on recent Google changes. So, all with this SEOmoz data you are sure to be looking at the most relevant data in Long Tail Pro.
      – Long Tail Pro can help established bloggers most of all! Yes, it can help you find deritivate keywords or completely new keywords. Here’s 3 steps I would advise ANY blogger to take:
      1. Input seed keywords that you think are relevant to your market. I would search at least 20 seed keywords to start. This will generate up to 16,000 relevant keywords (20 x 800). Filter as desired. Then check the competition (using the KC calculation is best). Then write articles on the low competition keywords (under 30 Avg. Keyword Competitiveness if possible). This will start bringing in new Google traffic.
      2. Go to your Google Analytics and export the keywords that people are already using to find your site. Use the new platinum feature of Long Tail Pro to import up to 10,000 keywords at once into the software. This will give you search volume, cpc, etc for these keywords. You will find keywords that you haven’t actually targeted that are getting traffic already on your site. Find the lower competition keywords that get decent search volume from this list and write new blog posts on them.
      3. Make sure to include the keywords in your titles. Read this post: http://www.nichepursuits.com/how-to-rank-in-google-the-beginners-utlimate-guide/

      I have lots of other ideas – but this will get anyone started :) I use Long Tail Pro almost every single time I write a blog post.

  8. Jace says:

    I’m quite sure your first programmer was not a Filipino. Filipinos are not that insensitive and not aggressive enough to demand $15,000 for something that obviously enough had already been paid for. What a dupe

  9. Spencer,

    You definitely made the right decision getting the software redesigned rather than dealing with the “hostage” situation. Karma will come back to that programmer.

  10. David says:

    Great story. As someone who is a developer by profession, you have done what most corporate ‘executives’ have been unable to. You have evaluated the facts and come to the correct conclusions. Software is not simply a matter of building it and job done. Cheapest headline figure is not always cheapest in the long run. The details are important! Communication and building relationships is at least as important as technical ability.

    Well done for figuring these things out, as I say most people in the wider software industry who commision and pay for systems still haven’t grasped most of them! :-D

  11. Muzi Mohale says:

    Spencer, would it be possible for LTP to offer country tlds, since i purchased my copy of LTP i don’t use it that much since its only focused on .com, yet am more into my country tld .co.za (South Africa.

  12. Yudiono says:

    Some of my readers asked me on how to do effectively keyword research. I recommended the Long Tail Pro to them because I am very happy to use the software.

    Unfortunately, the LTP hasn’t supported Indonesian location yet. I think I and other Indonesian bloggers will be more happy if you could add Google country for Indonesia on the LTP.

    By the way, I love your story of LTP.

  13. I have been doing SEO for quite some time now..and also have been an avid reader of your blog. I am impressed by how you managed to pull together this ultimate piece of software that definitely helped a lot of internet marketers out there. KW research is a very daunting task and finding low volume high density KWs are very hard to find especially now that Google is killing every website with its PP & EMD updates.

    Kudos and more power to you and your endeavors!

  14. David Landen says:

    Unfortunately, life has many lessons that we have to learn the hard way! I have make my share of “bad” decisions but try to learn from them. I think you made some very good decisions with Longtail Pro. By concentrating on the quality of the product instead and thinking about the long term you have built a loyal following.

  15. Guido says:

    Hello Spencer,

    I just wanted to compliment you on your style of marketing.

    Being open and honest combined with selling. Speaking your mind on Market Samurai without feeling the need to slam them into the ground (instead simply doing so with your product :D). And even this blog post is a great mixture of informative content and selling.

    I’m very happy this has all worked out as well for you as it did. :)

    I love the fact that there is a trial period for Longtail Pro and recommend that anyone who hasn’t yet done so makes good use of the opportunity.

    I think all keyword tools have certain quirks and will face Google API problems from time to time, Longtail Pro nog being an exception to this in the past or the future, but you really… really cannot go wrong with investing in this tool.

    As Spencer said: it is an exceptional product.

  16. Fascinating story Spencer. Regular readers of your blog, like myself, already knew much of this story. I’m glad you took the time to share more of the intimate details about your struggles and how you overcame them.

    I’m even more glad that you created the product and are working to constantly improve it. The Platinum version, especially the KC feature, has completely revolutionized keyword research for me. It took the hardest part of keyword research, first page analysis, and made it as easy as simply looking at a number. Incredible!

    I’m working hard to promote the product and hope to become one of your top affiliates.

  17. Sam says:

    Spencer,

    I am your big follower and pretty excited about software industry.

    Can you please tell me which computer languages and databases were used to build this site?

  18. Samee says:

    You are right, it is great marketing software which helps in adsense growth. I got this software and it makes me happy through its search.
    it is WOW software/

  19. Abdulrahman says:

    Being a user of this software for over than 2 months now I would like to tell you that the support is very week and I’ve never received an answer on how to remove the favorites or delete them.
    So my advice is please pay some attention to support.

    • Spencer Haws says:

      Abdul:
      We answer every single ticket within 24 hours. And I have full-time support staff. So, you must have missed our response. To remove favorites or delete them, you just click the red “x” next to each keyword. Sorry if you felt like you weren’t receiving support…but trust me, we are here for you.

  20. bola online says:

    What a material of un-ambiguity and preserveness of valuable
    knowledge regarding unpredicted emotions.

  21. Henry says:

    What a story. I like the idea of hiring other people to do what you can’t. Until now, I was seeing you as an expert programmer.

  22. Lior says:

    Loving the software so far Spencer! By the way, the dispute with the freelancer website wouldn’t have taken a long time.

    In most cases the freelancer gets scared away once you submit one, especially if bad reviews are a result of not complying with you.

    Either way good job!

  23. Mike says:

    Hey Spencer, what language was the keyword tool software programmed in?

  24. Joey says:

    Hey Spencer, loving your site. TY. This post resonated with me as I am considering using a freelancer to help me with my next app. Could you maybe pass me the contact info of your freelancer? THX. BTW, watched the comparison video last night between your app and market samurai. Im a noob in KR but the limited time I have spent with samurai showed me just how user friendly their app is not. Almost as bad as Googles tool. Will check out your demo of LTP most ricky tick. BTW, I got smoked in Pinewood Derby too. :)

  25. Jeff says:

    I’ve been using LTP for several months now and love it…….regular updates, great results……nice piece of software.

Comments are now closed.

                    


css.php