Vadim Kuzmitsky, the co-founder of the Sinners Marketing Agency, which works in the gaming vertical for Tier 1 countries, was recently interviewed on the Point G YouTube channel.
In this interview, Vadim shared how he put together a team of media buyers to start an affiliate marketing business without knowing how to run ads by himself. Vadim also addressed the following topics in this interview:
- How he hired his media buyers
- The biggest mistakes in starting an advertising agency
- How much he spent on launching the marketing agency
- How to choose a vertical and find the right partners
- How much does the team earn
- About life and business in London, why he moved to Kyiv, Ukraine, and his childhood life in Lithuania.
Vadim's Background
Vadim Kuzmitsky was born in Klaipeda — Lithuania, a town where he spent most of his childhood years. At the age of 20, Vadim moved to London, where he worked for 3 months at a construction site and then shifted to a consulting company. He later moved into real estate a couple of months later.
At the beginning of 2021, Vadim moved to Kyiv, where he started a marketing agency and assembled a team of 30 employees. The team specializes in the gambling niche and promotes lots of direct affiliate offers from gambling companies.
Prior to starting the business, Vadim didn't have any technical knowledge of affiliate marketing or media buying. He was inspired and attracted to join the industry after viewing a case study video on Youtube from Alexander Slobozhenko, a successful affiliate marketer from Ukraine.
"This guy lived in Kyiv, he is in his 20s and drives a McLaren. I lived in London and didn't make money to own such a car, and that meant to me that I was doing something wrong," Vadim described Alexander.
Life Before Affiliate Marketing
Vadim's first job after working at the construction site was at the consulting company Pricewaterhouse Coopers (PWC), where he assisted in organizing seminars, meetings, and so on.
He then joined a real estate startup engaged in subletting London housing. The company rented large apartments for an average price of £3 000 and rented them out by room for £4 000. Vadim says that the clients of their real estate agency were primarily students and IT people. For them, the most important criteria when choosing the house was its proximity to the place of study or work. This business flourished, and all clients were happy.
Vadim had 12 apartments under his management, which brought him a net income of about £10 000 per month.
Cost of Living: London vs. Kyiv
After moving to Kyiv, Vadim says that his average cost of living per month was about $5 000. In London, the entrepreneur lived much more modestly but he says that if he were to live in London with the same lifestyle he is living in Kyiv, it would cost him $17 000. You can live in London on a budget but that means you will have a less eventful life without parties and other youth pleasures.
Creating a Media Buying Team
In Kyiv, Vadim and his partner, who was also new to affiliate marketing, decided to look up for experts to join their team. He learned from his friends that media buying agencies, on average pay media buyers 25% of their profits. Vadim and his partner decided to raise that percentage up to 40% and announced job openings for media buyers.
According to Vadim, the 60/40 profit share approach was wrong. They initially did not consider that from their 60% profit, they had to bear the cost of renting an office, salaries to other employees, their own take-home payments, and other operational expenses.
With 60%, Vadim and his partner covered all the expenses for launching advertising campaigns. Vadim says that if he were to assemble a team now, he would offer employees a salary depending on the volume of leads they generate. For many media buyers in Kyiv, $1 000 - $3 000 is enough plus a 10% bonus from the profit they generate.
How Much Money Do You need to Start an Affiliate Team?
Vadim says that he and his partner started the business with $20 000. As it turned out, this was very little since the guys covered all the infrastructure costs of the business.
After 5 months in the business, they realized that they needed to inject more cash into the business for it to have higher ad budgets for both operations and scaling. They decided to attract a third-party investor, who was to earn a third of the profit without direct participation in the business operations. According to Vadim, the investor put in $100 000 in the business, which greatly boosted the agency.
Top 3 Geos
Vadim's media buying team works exclusively in the gambling vertical and drives traffic to offers targeting Tier 1 GEO's. Below is the list of their top-performing GEO's;
Why the Gambling Niche
The choice of working in the gambling niche at the start of his affiliate marketing journey was due to the recommendations Vadim received prior to starting the agency. Ever since he started working in this vertical, the team has generated a lot of profit, and they were in no hurry to experiment with other niches.
The team experienced trouble with Facebook in November 2021 and tried to switch to promoting crypto offers but all of their test campaigns were negative. So they abandoned that niche immediately.
Team Structure
Vadim’s team comprises 25 media buyers, 1 account farmer, and 2 accountants. Responsibilities among the two accountants are distributed as follows:
- Accountant 1: Maintains the general financial statements of the company
- Accountant 2: Deals with payments partners and employees according to their contacts.
Vadim is engaged in building relationships with partners and is responsible for personnel issues. His partner is focused on the financial side of the team.
Earnings
Vadim says that April 2022 was the best month ever since the team was started in terms of profits. They earned $250 000 in that month ad Vadim credits this to the fact that their team returned to work in the office almost in full force while most competitors were not working.
This was after the beginning of the Russia — Ukraine war in March 2022.
In May-June,2022, Ukrainian marketing teams resumed work, and Vadim’s agency profits margins fell back to 30%.
The minimum daily ad budget of a media buyer in the agency is $1 000. Vadim says that top media buyers spend in his agency spend between $2 000 - $3 000 daily. In his opinion, this is way lower than what the top teams in the industry spend which is an average of $300 000 daily.
About Working Directly with Advertisers vs Affiliate Networks
Kuzmitsky adheres to the general trend of the affiliate marketing community — he avoids as much as possible the idea of working with affiliate networks and he chooses to work directly with advertisers. This has kept him pretty successful. He also doesn’t depend on one advertiser but he works with multiple advertisers to diversify his portfolio of offers.
Conclusion
The story of Vadim Kuzmitsky is a story of adventure. The entrepreneur swapped from a stable real estate business in London to starting an affiliate marketing agency in Kyiv.
Many offline entrepreneurs have heard about affiliate marketing and decided to switch to it, but a few of them achieved immense success. Vadim chose not to get technically involved in the media buying process but rather set up a team of experts and he did the management part. This way, he was able to build an affiliate marketing agency without the technical knowledge and it turned out to be successful.
