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Paypal applauded for standing up to Entrepreneur.com, backing a small business

The Paypal dispute system has proven to be robust and fair after Entrepreneur.com failed small businesses

In a world where we often see how “might makes right”, Paypal has proven to be a fair and reliable business partner to small businesses. Recently, in the majority of disputes brought against the EMI bookstore (Entrepreneur Media), Paypal decided in favour of a smaller business who paid Entrepreneur.com for a service, only find that they deleted approved paid articles of SME’s on their spotlight page.

The owner of the PR agency, Adriaan Brits said had several comments regarding the incident. Firstly he said that “Unfortunately, through their conduct, it seems to me that Entrepreneur.com is an unreliable and inconsistent partner to the media industry. This actually encourages behavior among advertisers that undercuts the publishing industry- which in turn runs contrary to how the FTC requires the media industry to operate. I think Peter Shea (the owner) and Jason Feifer (the CEO) would be well advised to look into the way in which their management team dealt with this issue, unless off course they support what happened to us and our clients – and unless they enjoy seeing advertisers bypass their advertising team – which we certainly do not support”.

He also acknowledged that the publishing industry has challenges, but that Enrepreneur.com approached this a rather negative way that is simply not constructive: “Publishers have to focus on revenue protection at a time when click through rates are down. We can understand that – and do not approve of cases where PR agencies undercut them by colluding with authors. Yet instead of working with the industry, what we have seen from Entrepreneur.com – was sheer aggression which did not help to navigate this sensitive issue”.This is explained below:

As a PR agency, how did you start to work with Entrepreneur.com?

“In late 2018 I saw that a freelancer sold an outreach service, targeting writers who are with Entrepreneur.com – charging roughly $850 for this. I felt that this is undercutting the publisher industry and harmful to companies and their people – like Peter Shea and his CEO Jason Feifer who may have worked hard to build a company. So I reached out to their company and informed them of what is happening, and that we’d like to operate in a different way to protect their integrity, revenue and the industry. I got passed onto sales. Ultimately, a guy named Justin Koenigsberger said we can strike a deal on de-indexed spotlight content for the majority of clientts. The carrot for de-indexed, no-followed content was that it would be shared across the Facebook/Twitter/Linkedin accounts of Entrepreneur.com, which made sense to our clients. It started out as a relationship that complied strictly with FTC guidelines – something we could be proud of, yet this did not last long”.

The idea is that buying unofficial services (as per the image below) that bypass the advertising departments of publishers, is harmful to publishers – and a risk to advertisers as publishers may delete it. But when a publisher like Entrepreneur.com also deletes content business owners paid for – that ironically mitigates the risk to media buyers – especially those in the developing world with little regard for FTC guidelines.

Freelance gig bypassing the Entrepreneur advertising department:

Screenshot of contractors offering Entrepreneur.com guest posts

The following is a screenshot of the type of service which Adriaan Brits reported to Justin Koenigsberger in an attempt to help Entrepreneur close loopholes that leads to revenue loss:

How was the experience?

“Actually, working with Hilary and Jenna to upload content and share content was flawless, until Deepa Shah came along with a rather aggressive move. They discovered that the precise service we agreed to sell – which Hilary tweaked with me – was listed on another Freelancing site, by our agency. Deepa informed me that something that we sold to companies for less than $1500, jumped to $10K: in other words, overnight, our cost jumped by almost 10X for a service we promoted to hundreds of business owners. Clearly they had a problem with the freelancing site that we were unaware of – but we respected that and removed that in order to maintain a good relationship. This was not sufficient to deter a bullying response though, whatever the unknowns may have been”. 

How did you respond to Deepa at Entrepreneur.com?

“Not in a very nice way to be honest: It felt to me that they either had an issue with the Freelancing platform, or perhaps they were just very used to bullying businesses. I quickly red up on them and discovered what lawyer the law firm David Lizerbram had to say: according to them, Entrepreneur.com is acting like a bully. I reached out to other people I dealt with at Entrepreneur.com – but the query kept being passed back to Deepa, even from other important folks, as if they were fully on board”. 

What happened next?

“The batton got passed: She said that Justin Koenigsberger no longer works with me and her decision is final. The conversation went down hill and I discovered that the content our clients paid for, got deleted. Clients were unhappy that I advised them against informal gigs where people bypassed the advertising department – and I had nothing to say in defense of how the publisher behaved. Off course we could not ignore this given the effect it had on loyal clients who already paid”. 

Did you reach out to Peter Shea and Jason Feifer?

“Indeed, but they did not respond. Everyone else I spoke to at the organization passed the matter back to Deepa Shah – so it was as if she had 100% of their support to act in this aggressive way. We were hoping they (Peter Shea and Jason Feifer) would intervene but – neither them or their other managers ever intervened in this mess. Consistency in culture was the first thing that came to mind when I saw how the matter was being handled – there was a rigid approach with zero goodwill and seemingly a vengeance against certain platforms based in Israel – which we collaborate with “. 

 

What happened with Paypal?

“The only option left was to raise a claim against the EMI bookstore via Paypal. I proceeded with that. Their response seemed crafty to me: As Deepa later said it was their right to do so, since I breached an agreement by mentioning Entrepreneur.com on our agency website. This was not the issue she raised initially…. the only issue was that Entrepreneur.com wanted us to remove their service from a Freelancing site, which we did. So Paypal was very fair, by recognizing what appeared on OUR website had nothing to do with the SERVICE we paid Entrepreneur.com for. They held them to account by deciding in our favour on the majority of cases”.

What are your thoughts about Entrepreneur.com and the publishing industry?

“Publishers are going through a difficult time, having to comply with numerous algorithmic updates and maintaining growth in a very dynamic environment – as well as FTC regulations for their US operations, something we very much respect.Their traditional relationships with agencies are changing too, as platforms now cut out agencies. We have empathy with their situation. At the same time, we as an agency, had to evolve to the point of also working with freelancing platforms, regardless of the drawbacks – but there was no empathy with our situation from certain publishing clicks in NYC, who operated in a cocoon until now. But in the world, we can only resist change for so long. I wish Entrepreneur.com behaved differently – and that I did not have to discover what the David Lizerbram website says about them. Unfortunately, through the experience we had, I cannot disagree with the the assertions that it makes about Entrepreneur.com. Finally, I think Entrepreneur.com is about businesses and business owners. But this kind of behavior, is precisely against the spirit of Entrepreneurship – and should never be accepted. Thankfully organizations like Paypal are willing to act fairly in cases like these. Any big publisher should just look at how the current president (Donald Trump) came to power, thanks to a digital team who tapped into a wide range of alternative sources – since that will make them realize that they are not as powerful as they once were. A lot of credit should go to Google for dispersing the power of old monopolies in the media through a fairer news feed system”.

He also noted that the evolution of the advertising industry is witnessing a shift from bigger agencies with big fat margins towards platforms – and that his agency is working with a global platform based in Israel, which it considers to be a reliable partner: “I don’t like the idea that price cuts kill an industry, however when margins are reduced slightly and workers are paid more, with agencies taking a cut – well, that is a better distribution of spending power – especially for the American workforce where pay rises have been slow in recent years, despite rising profits in the global ad industry. We are witnessing the re-orientation of an industry, where geniuses like Micha Kaufman, a renowned platform owner and respected businessman, are playing a pivotal role, Kaufman’s platform is effectively cutting out the fat cats, linking CMO’s directly with top talent – I figured that since his platform went mainstream and is going through an IPO, if you cannot beat them, join them. So far we are having a good working relationship with his platform – with exceptionally competent and responsive staff in Tel Aviv and New York”. 

Conclusion – final points:

  • The Paypal.com system has proven to be fair and impartial regardless of the size and perceived influence of those who are in the wrong. Might does not always make right.
  • If Peter Shea and Jason Feifer can put this particular matter right – it will restore a lot of trust with small businesses and deter improper channels that bypass and harm the publishing industry.
  • Fortunately SME’s do not have to suffer at the hands of bigger corporations who act in a self righteous way, as alternative dispute resolution in E-commerce is effective, even as it is currently going through evolutionary changes – more on this soon.

More references:

https://www.bloomberg.com/news/articles/2011-05-19/entrepreneur-the-magazine-that-sues-entrepreneurs

 

 

Yet another Entrepreneur Media lawsuit against an entrepreneur

 

 

Virginia Sagal

Virginia Sagal interviews CEO's from around the world and writes about Tech / Fintech / Medical and Tourism. She majored in business management, is a yoga instructor and world traveller. She cares about sustainability, environmental issues an ethical consumerism.
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