Morningscore staff standing by a tractor pointing at the Morningscore mascot

Karsten Madsen On Partnerships For Growth

January 9, 2023

Hi, Karsten, great to finally meet you. I'm really excited about this conversation. To start with, please tell us a little bit about yourself and your background.


My name is Karsten Madsen. I'm from Denmark, Southern Denmark, almost Germany, that's where I was born. I've always been into technology since I was a kid, even though I'm born on a farm. 

In high school, I built my first technology company, kind of a Spotify for radio stations, and it didn’t do well at all. Yeah, we borrowed a lot of money from family, and we burned it all. Yeah, we were doing business the bad way. We thought perception is reality. So we had, like, several offices, and we spent a lot of money, but we didn't make any money. That's not how you run a business. Spoiler alert.

My first venture was very unsuccessful, but then we built an agency to kind of scrap back the money. And from that agency, we kind of got success with SEO, and we got a lot of big clients in Denmark. But my love is for products. So that's why at some point, I told my co founders, hey, we want to build another company again where we build a product. I fell in love with SEO. So let's build a really cool SEO tool that's gamified, where it's like playing a game, because I love games and I want to have fun at work while, of course, still delivering value, because that's what it's about, right?

I wanted to teach people how to do SEO in a fun way. So that's where the idea from Morningscore came up. What I didn't realize is that it's a very crowded market with more than 200 competitors, and I think we're doing okay. But it has been a struggle until this point to deliver the features and the quality of data that people expect and that they should expect, of course, but it's also been fun. And I think now we're finally at a stage where the product starts to mature. And yeah, that's a fun phase I'm in right now.


Your description of Morningscore and wanting to have fun at work while delivering value really comes across in your brand. I'd love to visit your office one day.


Yeah, we'll bring you the office uniform, a spacesuit, and we'll bring you to the arcade machine. We're building a game room now so we can sit and play old 90s games with you. And we're going to have fun.


That sounds awesome. Where did the idea come from for Morningscore? So the name and the brand and the idea of tying it in with a spaceman and the space branding?


I would like to give you some bullshit answer that's totally wrong. But the truth is I asked my designer to create a cowboy universe because I was really into the white hat and black hat, because in SEO we talk about white hat, SEO and black hat, where some of your readers will be familiar. And I thought it would be really cool to do SEO as this kind of cowboy exploration of conquering the wild west. And he started doing it, and suddenly he was like, no, it's not going to fly. It's going to be too weird. So he made it into a space theme. And then I said to him, yeah, but everyone is doing space, so what do we do? And he said, yeah, everyone's doing space, but they don't do it fully, do they? And I was like, wait a minute, we could go all in. So now, then I bought a space suit, and we start doing all these we just go all in, the communication and the brand on space exploration. And we do it in a silly way where we know we're not serious.

When we do that, we jump around in silver suits and so on. But for us, it's like, okay, let's go all in on the brand. And it is gamified, right? So let's have fun and let's make it a game. So, yeah, that's the idea.


Look, it works. Have you ever read Seth Goden's book Purple Cow?


Yeah. That's the only book I read from him.


Oh, really?


He wrote so many books.


Purple cow is all about being remarkable. You must have taken it to heart, I think you really have nailed that with Morningscore. 

One of our goals is to make marketing fun again. When Google ads first came out  and you could get really analytical and you can track people all over the place, and it was really cheap. Marketing for more than a decade got really analytical, and people forgot about the rest of marketing.

I think now there's a big opportunity for alternatives to paid ads


Yeah. And I want to touch upon that whole thing that I actually didn't like, the whole over analyzing and you had these people who could have become rocket engineers, and instead they became tracking experts or data engineers, like just sampling huge amounts of data and tracking customers wherever they would go. 

I'm kind of happy where we are right now that you have to approach marketing differently, as you say, try to make it fun again. Because I'm one of the people who struggled a bit with marketing. Let's say I think it was around 2017 or that time when it really peaked. Everyone was talking about tracking, tracking, tracking. And it was all about performance marketing. And I like performance. SEO is  performance marketing, but it just got too much. So I'm quite happy that now that the pot has been shaken and it's time to think differently, and your company is doing that too. So I think we're in a new wave of marketing, and let's try to feed on that.


A purple tractor with the Morningscore logo on it
Now you know why I thought of the book Purple Cow!

That's very much the plan. And one of the reasons that I was so excited to have this call, because I think a lot of people out there and a lot of founders, I see it on Twitter quite a lot, are now really starting to notice that the paid ads aren't returning what they used to do. And they're asking the question,  what do we do? What are the alternatives? What are the options? And I think it's really important to talk about that. Apart from SEO and partnerships, which we're obviously going to talk about today, what other areas of marketing do you focus on?


This fancy term, dark social. We've been doing it since 2018, when we started, and we kind of forgot about it the last two years. And now we start doing it a lot again. So what we do, we go on Quora, we go on LinkedIn, we basically look on the Internet, like, who's talking about SEO or where can we contribute? And then I call it guerrilla marketing because you're kind of out there and you're just engaging in conversations, reddit all these platforms where there are conversations going on that is relevant. So that's something we do. Yeah, we do social media a lot. Push content on social media. LinkedIn is my favorite platform. I'm trying to get into Twitter. In Denmark, we don't really use Twitter, so I guess that's the problem for me.

What else do we do? Well, not much right now. SEO, dark social media. We used to do a lot of ads. Horrible idea. We were part of that group of people who thought, oh, we can just do a lot of ads and then get investors to pay us to run these ads. We got lazy. We're like, okay, we can grow just by running ads.

But it didn't pay out. The cost of getting customers got too high. In a software business, you have this thing called customer acquisition cost, and in our case, we need to reach around $500, a bit less, actually. And it just, I think it rose up to around $800. And it just got very unprofitable for us to land one customer. And our product costs like sixty dollars to one hundred dollars a month. So in software you talk about the payback time, how many months does it take to get a customer back? And we rose way above twelve months. And people usually say if you can get below twelve months, that's great. And in our case, we just got way above. So that was a red alert. And that happened this spring. So we stopped all ads. Now we're back to SEO partnerships. Obviously we're doing a lot of that right now. It's actually the main thing we're doing right now in terms of new activities we're doing since the summer, so I can touch upon that. So those are the things we're doing. So.


Dark social. I've actually never heard that term, although I have actually myself started answering some quora questions. I've never had a name for it. I guess I intuitively started doing that. Guerrilla marketing. I'm a huge fan of guerrilla marketing.  



Okay, so partnerships, how did you get started with partnerships? What was the very first partnership you did and what led to it?


Well, now I have to remember the first time we've done  so many partnerships since. But I think to answer the question first, so I've been doing business for ten years, a bit more than that. And actually all my physical network, like all the networking I've been doing, I've been going to millions of these networking events and all of those physical network contacts is what gave me an edge in terms of building partnerships. 

Because now everyone's like, oh yeah, I just got to grind LinkedIn. LinkedIn is amazing if you have 50 people always liking everything you post because they know you so well from physical networks. There's just something about having met in real life and knowing each other. So a lot of my early partnerships were with different Danish companies that I've known through the years. 

So I leveraged that network and usually they would actually reach out to me and say hey Karsten, we saw you posted on LinkedIn, what about us doing a partnership? So some big media companies in Denmark approached me and said hey, let's do a partnership. And that has been very good deal for us because we really expanded our brand and our revenue with those partnerships.

Basically they just use our tool to sell more of whatever they are selling to their clients. So we fit the bill on that one. In terms of where we have been more proactive because that's more fun to share, because the rest you cannot really predict. It just comes your way. 

One thing I got to say, we always had a partner page since the beginning of a company. We had a partner page in our footer so everyone could see that they can partner up with us. And I think that's why a lot of people have also reached out to us. So I really recommend that. But what we've done very aggressively is to approach people who do webinars, people who do podcasts and when I say aggressive, we just ask them if there's an opportunity to co host something and then we've cohosted with a few other startups around and basically it goes like they invite their customers and we invite our customers for a branded co hosted webinar. 

We've been doing it with different bigger agencies in Denmark. We've been doing it with other SaaS companies around the world and usually it works quite well.

You get between twenty and one hundred attendees for a webinar and usually we convert like 10% of them as clients. So it's always been very nice.


A group of Morningscore staff outdoors in space suits
Love it when a team lives their branding

That's a great conversion rate.


A surprisingly high conversion rate, especially lately. I'm just thinking if there are some really genuine approaches we've taken with partnerships. But of course, affiliate partnerships has been a big thing for us. Also being on some of the platforms where you can list affiliate partnerships and also reaching out to agencies and what not to spread the word that hey, we have a cool affiliate platform. 

Mostly, again, it has been having that partner page on our website and making it very easy to test our tools. So right now you can go on our website and you can press live demo in the menu and you get a one click. One click and you get to see our tool. And I think that has made a lot of people like, oh yeah, I can see how it works, I could actually put this on my affiliate program and I don't even need to test it extensively because I can already see that it works and it seems cool. 

So if you're a software company making your product super accessible with one click, this is nothing new. Other people have done the same.

But I'm just sharing that experience now and then having a partner page and put up your affiliate rate like, how many percent you give. In our case, because we're gamified, you start with 20. We have like, three levels. So then if you refer one client, you grow to level two, where you get 30%. 

That number is not entirely correct, but you can look it up on our partner page and see the numbers. I'm missing some coffee here, but yeah, you get the point. And that's how we did it. Affiliate has been a big thing as well. It's around 20% of our new sales. 

There are other partnerships that we've pursued, like block partnerships, you know, content partnerships in general. Also, surprisingly, some collaboration with different organisations. I'm forgetting the most important. That was actually me who did very aggressive outreach. And when I say aggressive, I don't mean being an asshole. I just mean like, pushing the happy message that we could do a partnership. 

So my most successful partnership, I got to say, is I called up course companies doing SEO courses. So if you do something else, if you do I don't know if you do sales, there are also agent courses that teach sales.

If you build a sales platform, you would reach out to them and say, hey, I'd give your course attendees my platform for free if you would educate them in it. And because our tool is great for beginners as well, that would have worked out really well.

I was very aggressive. I called them up and I said, hey, we really love to see what opportunities there are. I called ten different course companies and landed one. The rest were interested, but it takes a lot of effort for them to actually do it. One of them did it, and they're still sending us clients every month and we just expanded that partnership, and they just threw out Ahrefs. They used to partner also with Ahrefs, and now they just threw them out. They want to do only with us now. So I'm very happy. That's fantastic.


I'm sure I do. And right there you have the whole reason for being for intribe, to really shorten that cycle of that outreach and all the hard work and cold outreach.


I feel like if your company is shortening the time to find partners, that's definitely very valuable.


Since you've doubled down on partnerships, since you stopped the advertising, where have you been focused in developing the partnerships?


Hosting companies have been a big focus, and we're happy now that we teamed up with Europe's biggest hosting company, one of Europe's biggest team blue. They're huge now. They have, I think, 300,000, no, 2 million customers b to b. 

They have actually said to us that they would push us to their home. They have a lot of portfolio of different hosting companies, and they would push us to their portfolio. Right now, we're working only with one of their companies, but as soon as that's a success, they want to push it further. 

We actually just did a webinar with them, and that was a big success. We got a lot of clients from that, and we're expanding it. They do a big conference as well, where they set up a booth for us. And you might imagine, how do we get that partnership? Again, leveraging my network from before I knew the CEO of that huge hosting company. But actually, that wasn't the thing. The guy of the partnership. I actually hired a partner manager who yeah, I told him we need hosting companies, and he went for the biggest first. 

So he just called up them and he said, hey, I see an amazing opportunity. We got a meeting with them, and then they saw the opportunity as well. And again, it's a kind of affiliate commission thing, but mostly they don't really care about the commission. They care about having a tool that their customers can grow with, because as a hosting company, you also have a lot of solo and small entrepreneurs who don't get enough sales, so they have to cancel the subscription to the hosting company because they go bankrupt or whatever reason they choose not to extend the hosting. 

For them to promote SEO is a great thing anyway. So hosting companies are a big focus for us right now. I would say course, companies and hosting, that's what we aggressively go for. That's funny.


That makes a lot of sense, because I wouldn't have initially thought about hosting companies straight up. But now that you say it, it just makes a lot of sense. SEO is all about websites, where I was thinking, what would make sense would have been the other alternatives to paid ads, like social media management platforms, referral marketing platforms, and obviously potentially intribe as a partnership marketing platform. 

We willl partner up with a few of those. And I think you hit the nail there that there's a lot of potential still left to be had. So that's definitely something we should look into.


A screenshot of the homepage for the Morningscore SEO app
Screenshot of the Morninscore homepage

Fantastic. Now, when you bring on board a partner, do you have an onboarding process that you follow? Do you do it individually by partner? Do you customize it for each one? What helps you make a partner successful?


Yes. So the affiliate partnerships, it's all automatic in a way. They get access to everything and they get an email with information and so on. 

The other more strategic partnerships, like big hosting partnerships, is very handheld. So my partner, I have a dedicated employee who does only that. Well, he does other things, but he's employed to do that and he hand holds it all the way because with these huge clients, enterprise companies, you need to push, push, push, push. So there's nothing standardized about that. 

Maybe in the future we will do it, but since we're the underdog, we're not the one to say, hey, you need to do that. You need to do that if you want to be our partner. We're very much an underdog. One thing we do have, for example, if it's a course company, we do have technology to support them. So for example, if we tell them, hey, if you want to give your course, attendee six weeks for free, we do have a unique link that allows that kind of thing and we do send that kind of information to them how to do that. So we have some standard approaches to how we deal with those.

 We're still a small startup, we're ten people. And a lot of it actually still requires manual work, which is fine by me because if we get a good partner, they can deliver several customers a month. And that's a very nice machine to keep upgrading.


Fantastic, music to my ears.

Karsten, can you tell me, out of all the partnerships that you've done, have any of them gone sideways or gone wrong in any way?


I think in general, most partnerships go wrong, I need to explain. 

So the reason why most partnerships go wrong is because most partnerships don't bring any fruit. They don't actually deliver. So when you realize that and I think everyone who has been in the partnership game for some time, they know that many partnerships just never deliver. 

Realizing that, you can optimize your time. Because I think that's the biggest issue with partnerships is that you can waste time on meetings, on calls, on things that don't actually work out in the end. 

So that's the “gone wrong” part. I haven't experienced any angry partners or, you know, there's always been a little bit of they didn't get their money if it was like that kind of thing where some small system failure stopped them from getting paid, but nothing major. It's always just been about do they deliver or do they not deliver? That's always been the thing.


That's why I often think about partnerships like dating and marriage and just like when you're dating, they don't all work out.  What are your overall main learnings out of all your partnership experience.


Yeah, so it's a little bit back to what I said. The learning is to figure out where the sight, the challenge that I had was to figure out when to dedicate what time. 

My learning on that is to keep expectations low until I see something working. I will no longer take long meetings before I know if the partner is really engaged. I will no longer give intro tours or explain our partnership program in detail before I know if they commit to anything. 

So I'm way more careful with my time invested. There's going to be a lot of promises that are not being kept, but you can use that to your advantage.  You can lead the way and sometimes turn an underperforming partner into a good one.

The big question is “how much energy do we put in?” The small partnerships are easy. They deliver, you give them more time, you give them more resources, that's easy. 

The big partnerships are more difficult. You can spend half a year, ten meetings, and it might be like game changing for your company or it might be nothing. And I still have a very hard time spotting, is this going to be good or not? With partnerships, there is that challenge. 

On the other hand, there is an amazing upside that you will not get from most other channels where the partner delivers and you're like, whoa, we're getting all of these sales that we didn't work very hard for.


So what would you then say to a startup founder, let's say an early stage startup that are still testing channels and thinking about things and thinking about partnerships? What would be your words of advice?


Well, it would be exactly, don't be too optimistic and evaluat carefully what the prospective partner says they're going to deliver. Be sceptical, but in a constructive way. Don't invest the time fully before they commit to something as well. 

And be quite open about that, that you require some commitment from them, that would be my advice.

Fantastic. So then, just to wrap things up with a final thought on partnerships overall.


Yeah, this is very specific and very concrete and I think it's a nice thing to end with because I'm currently working on partnerships and I can give you my takes on that. 

I'm in the SaaS business, so software as a service, and I'm currently working at getting more affiliate partnerships. So people who recommend our product through a link or whatever, and then they get paid when they refer customers to us. There are a lot of platforms out there, but most of them are not made for SaaS. They are made for web shops or ecommerce in general. So one thing I'm currently learning is that 90% of the platforms out there don't work if you're a SaaS founder. 

There are many of these platforms that promise that just go on our platform. We have 200,000 affiliates that will promote your product and it's on our autopilot. And currently I'm testing some of those and none of them really deliver for SaaS. So that's all.  

A screenshot from the Missions page in the Morningscore SEO app
Screenshot of the gamified Missions page


I love hearing that because I think that's the opportunity for intribe. One thing that I think is very true about partnerships is that they are about people. The magic for intribe is if we can actually find that sweet spot between automating the mundane tasks while actually helping brands build stronger relationships with their partners.


Yeah. I'm also going to test out intribe for my partnership, hunt?

Because my current goal is to spend the rest of the year really ramping up our partnerships, both the big strategic ones, but also like the really small, could be affiliate, could be, whatever. 

My advice for SaaS founders, if anyone is a software founder, is to use your own in house platform to work. If you're going to work with affiliates, just use your own in house platform. Because most of the networks out there are really outdated and not made for SAS. Most of them don't even have recurring commission tracking. 

So I couldn't even pay my partners for, let's say I have a customer for two years, but they pay monthly, then that partner would only get paid for the first month. That's not so fun for them. So, yeah, that's the discovery I'm making now. And I think platforms like yours is a great alternative to the old networks that are, at this point, probably a bit outdated now.


That's great news.  Thank you very much for your time, Karsten

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