Navigating the Digital Business Landscape With Chris Yates of Rhodium Network

Chris Yates is the Founder of Rhodium Network, a community and events platform designed to support digital entrepreneurs through facilitating business deals, partnerships, and connections. Before his current venture, he made waves in the digital marketing agency realm and was instrumental in a series of online businesses, culminating in impressive profits. With roots in an entrepreneurial family, Chris learned the business from his father’s publishing enterprise and various subsequent ventures. He later channeled this upbringing, combined with his tech-savvy skills, into cultivating an environment where business deals and partnerships flourish among members. Chris owns and manages a portfolio of income-producing websites and teaches others the best practices for securely purchasing established websites.

Here’s a glimpse of what you’ll learn:

• [04:17] Chris Yates discusses the organic growth of Rhodium Network and what it does
• [06:05] Rhodium’s first event and the excitement it generated 
• [10:19] The transition Chris made from an agency-based business to focusing on acquiring digital businesses
• [13:14] The key lessons Chris learned from his early acquisition experiences
• [20:47] The criteria and due diligence process for evaluating potential business acquisitions
• [25:13] Scaling Centurica to a thriving due diligence service for business buyers
• [29:07] The strategic development of Centurica’s MarketWatch to engage and retain potential customers
• [34:32] Effective techniques from past Rhodium event speakers on transitioning to the four-hour work week
• [39:29] The integration of a robust community model to maintain engagement among digital entrepreneurs 
• [43:15] The structure of Rhodium Network, including events and the ongoing community

In this episode…

Have you ever felt like you’re on a hamster wheel, tirelessly grinding but craving a more impactful and efficient way to run your business? The road to entrepreneurial success can be isolating, but what if there was a way to navigate it with a community of like-minded individuals?

Internet entrepreneur Chris Yates delves into how he founded Rhodium Network to address the loneliness and isolation often felt by successful digital entrepreneurs. He shares his challenges, from the emotional decision to sell part of his business portfolio and mastering the art of online business acquisitions to harnessing the power of community for personal and professional growth. Chris also discusses the evolution of Rhodium, from its first meeting to its current offerings, including highly curated events and an engaged online community, revealing the value of blending offline and online interactions.

In this episode of Inspired Insider Podcast, Dr. Jeremy Weisz interviews Chris Yates, Founder of Rhodium Network, about building and nurturing digital entrepreneurship. Chris discusses the organic growth of Rhodium Network and what it does, the transition from an agency-based business to focusing on acquiring digital companies, fundamental lessons learned from acquisition experiences, and the integration of a robust community model to maintain engagement among digital entrepreneurs.

Resources mentioned in this episode:

• Chris Yates on LinkedIn
• Rhodium Network

Special Mention(s):

• Built to Sell: Creating a Business That Can Thrive Without You by John Warrillow 
• The EXITPreneur’s Playbook: How to Sell Your Online Business for Top Dollar by Reverse Engineering Your Pathway to Success by Joe Valley

Related episode(s):

• “[SaaS Series] Tips To Thrive in the SaaS Space With Sujan Patel” on the Inspired Insider Podcast
• “Intentional Growth Principles: Secrets To Repairing a Broken System With Ryan Tansom, Co-Founder of Arkona” on the Inspired Insider Podcast
• “How to Sell Your Online Business for Top Dollar – The EXITPreneur’s Playbook” on the Inspired Insider Podcast
• “Lessons Learned from Buying and Selling Businesses with Mark Daoust Founder of Quiet Light Brokerage” on the Inspired Insider Podcast
• “[Sweet Process Series] How to Build a Business That Can Thrive Without You with John Warrillow of Built to Sell” on the Inspired Insider Podcast
• “[Top Agency Series] B2B Sales — Biggest Mistakes and Lessons” on the Inspired Insider Podcast

Quotable Moments:

• “I treat Rhodium Network much more like a craft, an indie event and community.”
• “If you’re in partnership with a good human, these types of situations aren’t that difficult.”
• “I was more interested in having assets I could utilize to build businesses rather than just operate businesses for others.”
• “Treat it like you’re buying a real business, have a relationship with customers, and have your hands on the levers of your business.”
• “I sort of fell into this idea that blending the offline and the online worlds makes both of them better.”

Action Steps:

1. Evaluate the sustainability and future potential of a business before acquisition: This addresses the need to avoid peak-level purchases and ensures room for growth and profit margins.
2. Identify pivotal roles for delegation and outsource accordingly: Effective delegation can free up time for entrepreneurs, allowing them to focus on higher-value tasks and strategies.
3. Implement a non-disclosure and non-solicit agreement during acquisitions: This protects sensitive business information and customer relationships throughout the due diligence process.
4. Blend online and offline community interactions to enhance engagement: Strengthening relationships through offline events can lead to a more invested and active online community.
5. Stay adaptable to shifts in business landscapes and customer feedback: Flexibility and responsiveness to industry trends and customer needs can drive the evolution of a business and unlock increased value.

Episode Transcript

Intro 0:01 

You are listening to Inspired Insider with your host, Dr Jeremy Weisz.

Jeremy Weisz 0:22 

Dr Jeremy Weisz here, founder of inspiredinsider.com, where I talk with inspirational entrepreneurs and leaders today, is no different. I have Chris Yates. You could check him out rhn.com he acquired a three-letter domain. I don’t know if he’ll reveal how much he paid for it was probably expensive. And his company is Rhodium Network. And Chris, before I formally introduce you, I always like to point out other episodes of the podcast. People should check out, since this is fitting, you do a lot of experience, decades of M&A acquisition experience from both ends of the spectrum. And so another good episode is John Warrillow, who wrote Built To Sell. That was a really good one. Ryan Tansom, intentional Growth Principles. He talks about the secrets to repairing a broken system. I know you know Ryan well.

Joe Valley and Mark Daoust, who run Quiet Light, have a top online business brokerage, who you know very well too. And Joe talked about the Exit-Preneurs Playbook: How To Sell Your Online Business. That was an interesting episode, and it was really interesting. Chris and I, we’ve known each other for a while, and we even bumped each other when you were having an event in Vegas. One time, I was reminded of this. I had Peter Palarchio of NAV43 on. He gave one of the most glowing testimonials for any company I’ve ever heard on the podcast. I said, like, what are some things that have moved the needle for you and your business? And he mentioned there’s this thing called the Rhodium Network. I’m like, Yeah, I know what the Rhodium Network is. And Chris, but he raved about it.

And so Sujan Patel is also on that was a good episode about growing Mailshake through acquisitions. I know he’s spoken at your events, so check out those episodes many more on inspiredinsider.com and this episode is brought to you by Rise25. At Rise25 we help businesses give to and connect their dream relationships and partnerships. And how do we do that? We do that by helping you run your podcast. We’re an easy button for a company to launch and run a podcast. We do the strategy, the accountability and the full execution. So Chris, we kind of call ourselves the magic elves that run around to make it look easy for the host, so they can create amazing relationships, amazing content, and, most importantly, run their business. And for me, the number one thing in my life is relationships. I know you run a community, so it is for you as well. And I’m always looking at ways to give to my best relationships, and I found no better way, over the past decade, to profile the people and companies I most admire and really share with the world what they’re working on. So if you’ve thought about podcasting, you should. If you have questions, you can go to rise25.com or email us at [email protected].

I’m excited to introduce Chris Yates. He’s the founder of Rhodium Network, which includes a community and events for digital entrepreneurs. The Rhodium Network has resulted in lots of wins for its members, including hundreds of millions of dollars in deals, business partnerships, friendships, and I think Chris even a marriage as a result of people being engaged in the community. Chris is actually living proof of the success of Rhodium, because Chris, I know you acquired a business. I mean, you’ve acquired many business, but one of these businesses from a member of the community, growing it to seven figures a year in profit with the help of a partner that you found from the community, and then exited to a third member who was part of the community. So it kind of comes full circle. But Chris, thanks for joining me.

Chris Yates 3:52 

My pleasure. Yeah, I think they call that dog fooding. I’ve been able to do that within the community, so.

Jeremy Weisz 3:56 

Exactly. But let’s start off with just talk about Rhodium Network and what you do. And as we do that, there is a video version, so if you’re listening to audio, there’s a video version. And we’re going to poke around Chris’s website. So tell people a little bit about Rhodium Network and what you do, and maybe we’ll go through some of the evolution.

Chris Yates 4:17 

Sounds great. Yeah. I mean, from a high level, I got to the point where I had built up this portfolio of these online businesses and realized, man, it’s kind of isolating and lonely doing what I do for a living. I live in Montana, so it’s hard to find people who can speak the same language. And so way back in 2012 over a decade ago, I put together a small gathering of people in Vegas to get together and kind of share what’s been working for me in terms of these acquisitions and stuff like that, and then it’s really just grown organically through word of mouth I’ve listened to the community, and today, what it’s made up of is four main well, I guess you call it like typically, owner operated, profitable digital businesses.

Business models are typically going to be e-commerce, media services and SaaS and revenues could be anywhere from like, high six to mid nine figures, with our typical member in that, like, low to mid seven figure range. And one thing that I think makes Rhodium special is just that I work really hard to create a culture of giving within the community and people being willing to pay it forward and share experiences and things like that. So when you get really smart, kind of curated people, I should mention, I also meet everybody before inviting them in. But when you get smart, curated community of people together with a culture where people want to help one another, kind of magic just tends to happen. Which were some of those outcomes that you mentioned would be examples of that.

Jeremy Weisz 5:38 

Talk about the first event that you did. And it’s funny, because I was watching you presented at, I don’t know if it was an idea mensch event, specifically, it was like 10 years ago, and you were talking about, at that point, still acquiring a bunch of businesses. So talk about your first event, the first iteration of Rhodium.

Chris Yates 6:05 

Yeah, so the first iteration. At the time, I had a business partner who had some experience with events, and I was much more of the guy behind the scenes. If you would have said to me that like at the time, hey, Chris, you’ll be running this community of 1,000 really successful and smart entrepreneurs. I would have totally said you were crazy, but yeah, so the first one was sort of a, let’s get people together who are interested in this stuff that we’re doing as a byproduct, that we’re going to meet some cool people, learn some cool stuff, and maybe get access to some deals. At the time, we actually had a training program. And the funny thing is, we bought that training program that teaches people how to buy businesses. So we bought the business that teaches people how to buy businesses.

So with that came a list. And so sometimes people like, Hey, how did you get that first group of people to there? Well, we bought a list, essentially as part of this brand that we acquired, and we leveraged that to get the first group of people, so, yeah, my business partner’s wife, had experience with the catering department at the win, so we were able to get a hotel, or kind of convince them to give us a conference room there at the win in Vegas. And God, I think maybe it was like 20 to 30 people who showed up. And I remember just, yeah, like, people were kind of like, man, this is awesome. Like, we have really just a small, intimate community here of like, 20 or 30 people who are really experienced with these digital businesses. And, like, light bulb kind of went on a little bit like, oh, wow. Maybe I don’t have to teach maybe just the fact that I get good people together is enough.

Jeremy Weisz 7:43 

How did you decide to charge for that first event?

Chris Yates 7:50 

I mean, it was like, I’ll tell you, generally in the event space, the first event’s gonna suck. You’re probably gonna maybe break even, if you’re lucky, the second event’s still gonna kind of suck, but it’s maybe a little bit better. And if by the third event, it doesn’t get more, you don’t see it actually getting easier, something’s wrong, so the first event’s always going to suck. I’ve learned that over the years. And that’s, you know, certainly the case. Like, it did go well, just in terms of, like, content and stuff, but from an ROI perspective, it was tough, we hired, like a video guy, and we had, like, a food and beverage minimum with this conference room and all this kind of stuff.

And so, we kind of had this nut we had to sell enough tickets to so, you know, we figured price wise, okay, well, if we can get X number of people at this price, it makes sense. We didn’t want to charge so little that it actually would devalue the event and make people think, oh, this is just a pitch fest or something like that. So I want to say that first event was around maybe somewhere around $1,000 mark for like, a two or three day event, if I remember correctly, it’s been a while.

Jeremy Weisz 8:54 

Well, it’s interesting, though. I’m just curious, because, you did have a back end overall, because your business was training people on this. So it wasn’t like you were starting, you went out to start an events business, per se, because your business was teaching this. So it was kind of an extension of what you did.

Chris Yates 9:14 

And our core business was actually doing it like we were out there buying these online businesses and operating them ourselves. So yeah, I mean, it’s almost like the deal you mentioned, you have your core business, which is operating these businesses, and then as a byproduct of having a community around you, you may get more of those deals or opportunities for those deals that will come up. And then potentially you might be able to provide services or coaching or training, or some of those kinds of things, if in a worst case kind of scenario. So yeah, we had a little bit of a funnel. We hadn’t really quite figured it out.

Jeremy Weisz 9:50 

What’s interesting is, you’ve used acquisitions to shortcut time and money, right? So going back to when you were working, you’re working for a company, and you ended up partnering, I think, with your boss at the time. Talk about that transition point to you’re working for a company, and now you decide to go off and start a separate company.

Chris Yates 10:19 

Yeah. So this is actually for people who want to become entrepreneurs, but sort of have the golden handcuffs of their current job, I don’t know if this is a common path. I’ve heard it a few times over the years, but I think it is a story that would be potentially relevant for many people. So essentially, what happened was I was working getting really good results, and the owner of that business, I guess he I see it as more of a mentorship relationship, where he saw a lot of potential in me and at the same time, like I was really benefiting his business, and we had these digital marketing things we were doing to grow his business. And so at some point, he’s like, hey, we should be doing this for our clients. And he knew I was interested in entrepreneurship because I had done some smaller businesses through college, and had kind of gone down that path a little bit.

And so I can’t remember exactly how it went down, but we decided that, hey, we’re going to partner together and sort of take our marketing department that is in house currently, turn it into an agency, the main company will be your first main client to make sure that really, you have no risk at this point. And then you will also get equity in this new marketing company. Now we can service the clients of the main business. So what an easy way to step into entrepreneurship in a very low cost way. And having a first big client and a steady lead flow of new clients. I mean, you can’t ask for much more than that if you’re starting an agency.

Jeremy Weisz 11:48 

So you go from a job marketing company, what was next?

Chris Yates 11:54 

What was next is continuing with that. Somewhere along the way, I met who would become my wife, and that pulled me away from where I was living at the time so that we could end up moving and starting a life together, essentially. So as a result of that, I worked remotely and continue to run this agency and help these small businesses and things like that. And eventually it made sense for me to buy my old business partner out of that company. So this became my full, I guess, business, 100% ownership, and continue to run that with a really great relationship with the original boss slash mentor that I mentioned.

Jeremy Weisz 12:34 

So how did you structure that bio? That’s like your first kind of it’s not really an acquisition, but it’s an M&A deal.

Chris Yates 12:44 

I hate to say it, but I don’t even remember the specifics. We kind of value the business, and I ended up paying him. I think he was able to do it like by paying him out over time or something like that. To be honest, I don’t even remember it’s been so long, sorry.

Jeremy Weisz 13:00 

Well, I mean, that helps. I mean, you had a certain percentage each of you owned, you valued the business, and then you were able to, since you were working in the business, were able to pay him off over time. Didn’t have to kind of give him a lump sum, but then…

Chris Yates 13:14 

Yeah as any mentor would be, like he was super, I guess, generous with the process and understanding and all of stuff. And so if you’re in partnership with a good human, these types of situations aren’t that difficult. It’s when you have conflicting interests, where those types of things become much more challenging. I’ve seen.

Jeremy Weisz 13:35 

So when did you step into really putting acquisitions on hyperdrive, or you started to really use that as the path and vehicle to increase the portfolio?

Chris Yates 13:49 

Yeah. So one of the limitations with an agency like I was running is that your ability to generate income is tied to labor, essentially. So you either need to hire people or you need to work more. I was doing both, and I found that I wasn’t totally enjoying client headaches, with managing expectations of these smaller, price sensitive customers, employee headaches, etc. And always felt like, man, I’m using my knowledge to build everybody else’s businesses. Why don’t I have assets that I can utilize this? So that was in the back of my head. And funny enough, the original boss mentor I mentioned, sold that original company that I was part of and decided, hey, I want to see what Chris is up to these days. And so we ended up kind of putting our heads together and coming up with the idea to, hey, why don’t we go start buying some digital businesses and we’ll do something together on that. So sort of came back to that one relationship again.

Jeremy Weisz 14:48 

So, what was the first milestone for you as far as purchases go?

Chris Yates 14:55 

Yeah, so what we did on that first deal, as far as what I can remember, was we found somebody who was already in the space doing this successfully, had a bit of a track record, and we were starting to buy up some of these, like brands, the training thing that I mentioned, and things like that, on our own, getting a little bit experience, just on small deals and stuff. But our first, like, more substantial deal, was finding somebody who actually knew what they were doing, at least we thought and partnering with them, essentially. So they brought the deal to the table. We brought money, and did the deal with them, the idea being that we would buy this business, and they had a path for growth, and then the idea was to turn around and flip it relatively quickly. So that was one of the ways we bridged the gap from very little knowledge to hey, let’s leverage other people’s experience.

Jeremy Weisz 15:48 

And then what was the first deal you were nervous about? Sounds like the initial deals were smaller and you were just getting your feet wet and kind of going through the process a few times, but then you scaled up to more six figure deals as opposed to smaller deals?

Chris Yates 16:06 

Yeah, I would say our first six figure deal was probably one where I was nervous about that, because at the time we actually, we saw a lot of potential in what we were doing, getting really good returns doing it. And so we had a potential investor who wanted to be part of it, and gave us a really attractive valuation, came with a check. And so it was something where in order to really make this something that could be much bigger, we had to start going bigger, right? And so we had some expectations of an investor, and we’re doing this larger deal. And I didn’t really realize how risky that first deal, looking back on it now, I know we, if I would have, if I were to do it again, would definitely not have done that as our first, sort of six figure deal. But, yeah, that was one that definitely made me nervous, more expectations in Vault.

Jeremy Weisz 17:01 

Why wouldn’t you have done that one? Looking back.

Chris Yates 17:03 

It was all built around SEO, search engine optimization. And for those who’ve been around the game for a while, it was just before Penguin, one of those algorithm updates that were pretty substantial, and we didn’t really know much about due diligence on backlink building, and some of the things that you would do, knowing what I know now, on a deal like that. And had I looked closer at that deal, would have realized this is not something that is super sustainable as it stands now. And yeah, like it ended up getting hit and dropping by, I want to say like, traffic dropped by like 70% revenue dropped like 60% overnight, essentially, because the whole business model was go get free traffic from Google and then monetize it. And there was no real true business behind that, where you had a relationship with the customer. It was all about new traffic to the website.

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