Dennis Yu – Rise and Fall Of A Con Man In The Affiliate Industry

Dennis Yu

I was at ad:tech San Francisco 6 months ago when this little Asian guy came up to me and asked me how I liked the post he had been writing. I had no clue who he was or what he was talking about. He introduced himself as Dennis Yu and told me the posts that Harrison Gervitz guest posted on ShoeMoney.com here and here were actually written by him. I was surprised but in this industry as I have said before everyone is full of shit so… whatever. Ironically 2 minutes later Harrison happened to be walking by us and I called him over to get it straightened out. The actual deal was Harrison had written the posts but Dennis proofed them for him… ok big deal.

After ad:tech Dennis emailed me repeatedly saying he wanted to do something together. He said he had a company called Blitzlocal that was funded by Plenty of Fish creator Markus Frind. He said he had a lot of interns for the summer that were banging our projects with many people. He dropped every name in the book including telling me they were about to name SEOMOZ founder Gllian Muessig as their Chief Financial Officer. Dennis also told me Scott Richter was involved in some of Blitzlocal’s ventures and was getting hooked up with rent and amazing payouts from Scott’s affiliate.com.

Dennis offered to fly me and put me up for a couple days in Denver so we could talk about what we were working on and see where there was a good fit. I later found out this was taken care of by Scott Richters people.

My visit there was really awesome. I was really impressed with Dennis’s setup. He had about 5 or so interns all very very smart kids. I was very impressed with them. Dennis is not very technical so I had a lot more dialog with his interns (who all looked like right out of highschool). demonstrated his blitzlocal product to me and I was pretty blown away by it. Its an amazing product for small businesses. But when I asked about revenue thats when things go really weird. They said nobody was actually paying for the service….

I was confused. I had emailed Markus Frind and not only did he confirm that he was an angel investor in BlitzLocal but that he had already gotten a great multiple return on his investment… Markus also told me he introduced Dennis to affiliate marketing a couple years back when Dennis left Yahoo! (even though he claims to have been doing it since the late 90’s in all his speaker profiles)

So obviously my next question to these kids was how the hell are you making money if nobody is buying your product. Thats when they told me the real deal.

They went on to explain that the BlitzLocal local product was for now just a cover for the company and that they made almost all of their money from porn websites. They showed us a bunch of the porn sites they were doing, what they were doing with them and some small talk about their revenues. I was surprised but not like taken back or anything. Anyone who knows me knows I have no problem with stuff like that and am pretty open minded when it comes to making money online. If anything I gained more respect for Dennis because being a badass in the porn business is about as hard (no pun intended) and competitive as it gets.

The one thing that did stick out was the Gillian SEOMOZ owner connection. I just don’t see Gillian as CFO of a company that specializes in porn… and I am pretty sure everyone in this industry would be equally surprised. But they did have Gillians son Evan as their SEO expert and he was a big part of what they were doing so when they told me Gillian knew about the porn and stuff i was like OK well whatever, proceed…

They also showed us some of the affiliate things they were doing and told us that Affiliate.com took ZERO margin.

They made a proposal to me that they would redesign Nextpimp, we could leverage their higher payout on ringtone leads (yes even I can’t get zero margin payouts), and they would maintain the website day to day and take 50% of the additional revenue they brought into the website. Sounded like a massive win!

I talked to his interns about doing a lot o different stuff. I had many ideas for lots of different web services. Things looked promising. But again this kind of stuff happens with us a lot of the time and works out maybe 5% of the time. Everyone gets excited talking about doing things but nothing really every happens after that.

Again though Dennis really was not involved that much in discussions.

After our meeting we went to dinner with Scott Richter and a bunch of affiliate managers. Once dinner was done we went to one of Denver’s hottest night clubs Suite 202 where Richter is quit the VIP. They kicked out some Denver Nuggests players (no bullshit) from Scotts normal table and we partied on. Was a great night.

The next day I flew back to Lincoln but was pretty pumped about working with Dennis’s team on stuff. Evan Fishkin started emailnig me right away talking about SEO strategies about what we were working on. I was not quite ready to jump into the sack though with these guys and insisted we have another meeting where I could bring down David Dellanave to sketch out stuff.

It also worked out really well that Affiliate Convention was like 10 days away and we were going to be in Denver anyway. So we planned to meet all around that event. Our meetings went well. They went through everything with David that they did with me. I really enjoy having David size up people cause between us we usually can spot the bullshit. We sketched out some stuff for nextpimp on what we wanted them to do. David was impressed with Dennis’s interns. They seemed very technical and skilled. David was not very impressed with Dennis and said his initial impression was that he was all smoke and mirrors. Dave is not big on talk and wants to see results. Plus we are working on some giant projects on our own and don’t want to get side tracked with dumbshit that could amount to nothing. During our time there though we went out almost every night and were pretty wined and dined with Dennis (Scott Richter funded though).

Over the next couple months I would ping Dennis and ask him where they were at with our project. Never got a very detailed response. Just that we would do a webinar showing where they were at. Now at the same time I had done some small SEO tweaks to the site that really helped in rankings and increased revenue about 25% or so.

The funny thing was…. ya you guessed it… even though they had done absolutely nothing to the website Dennis felt like he was entitled to 50% of the extra revenue per our deal… ermm… thats not how it works =P. So I told him like dude you know what show us what you are doing or are going to do or this deal is off. I am not going to give you a revenue share from something I built over almost a decade and your doing nothing.

So the next week one of Dennis’s interns showed us wire frames of what they were thinking of doing for the site. It was done REALLY well but it was a total change of the site. Like a DRASTIC change. It was going to fundamentally transform the site a total different way. The whole reason I wanted to have Dennis’s people eventually running the site day-to-day was cause I did not want to have to do anything… I had already invested a decade of r&d for that demographic and this entire new approach was a huge thing. I told them at this point I think we should can our deal. Now I take full blame for not properly communicating exactly what I was wanting them to do. The work the intern had done was amazing and I encouraged them to launch their own website with the path they were on. So we parted ways on that project.

Over the course of the next couple months Dennis volunteered to help us with a variety of things for me everything from some basic graphics work to helping with our shoemoneyx.com course and every once in a while would ask for introductions to people in the industry for him. Even though every major thing we talked about doing had fallen through he had come through for some small stuff that was really needed and important for us.

I felt very comfortable doing intros for him… I even scored him a position to moderate the Monetizing Facebook Panel. Things seemed fine right?

At Affiliate Summit East things started to turn. As we were doing our panel and Dennis was talking I realized some of the stuff he was talking about was complete bullshit. After the panel I talked to my Facebook friends and even some of his own employees were like, “I can’t believe he said that. He is just straight up lying. We do not do what he is saying we do with Facebook”.

Shortly after Affiliate Summit I was contacted by these 2 guys who specialize in Facebook PPC. They asked who did all of our Facebook ppc and if we were looking for some people to manage it. I told them as of then it was 100% done by me. They told us they had a lot of experience and would love to be contractors for us for a revenue share of the profits. We allocated them a small budget of like 100k for a week and they did incredible. They were a great missing piece of the puzzle for us.

While we are sitting on a lot of capital and have lots of connections in the industry we did not have any dedicated PPC people so we were not doing that much stuff. This seemed to make sense. What I did not know at the time is that they also had a similar deal with Dennis Yu but he had burned so many bridges with companies doing super sketchy stuff that they were now literally making nothing doing his Facebook stuff (more on that later).

One day out of the blue I got a email from Dennis Yu talking about how awesome *our* Facebook revenue was. I was like umm wtf? I contacted our Facebook guys and they said they had some deal with Dennis and was sharing revenue stuff out of their cut. I was really surprised Dennis was involved and did not understand it. I told them I don’t like a lot of people in my business and if they wanted to do anything with us they were not going to be able to share data with people. If they had some previous deal then cool honor that deal I can appreciate it but don’t be sharing my day to day operation stuff.

We continued on and these guys were doing very very well. We were constantly testing new niches. Between our technology and relationships with companies and their management of the campaigns it was really a great fit.

During the weekend of AzoogleAds Playboy mansion party Dennis flew down to Los Angelas. He was not invited to any of the Azoogle stuff but was just kind of tagging along… only he couldn’t cause he was not invited it was awkward for him =P.

At the same time I got messages from 4 of his 5 employees I had met that said they were no longer doing anything for him. Something was up. I was also told a rumor that he had been officially banned and even gotten some other companies banned (allegedly) from Facebook who he was running their accounts for. Something was up…

Anyway he texted me and said we had a security problem and needed to talk right away. I was like ok sure, gave him my room number, and he showed up a few minutes later.

In what would be the most insanely awkward meetings I had ever had in my life Dennis acted like he was managing all of my Facebook PPC stuff and the contractors that we had hired were actually his employees thus I had a deal with Blitzlocal and he was entitled to 50% of the profits that those guys had made. I was like … wtf .. it was really really a strange situation.

He went on to tell me that we were using their intellectual property and stuff… and that he would be coming after us legally as well as the contractors we were using if we did not pay up.

I don’t respond well to threats like that. I basically said, “thanks for stopping by. I don’t know what previous agreement you had with these guys but my agreement is and always has been with them. I never even knew you were involved at all. Here is our lawyers contact information. Peace out.”

He kept trying to convince me that it was him all a long that was running my Facebook PPC account and not these guys.

I was not buying it.

Two days later I had a meeting in Palo Alto with 3 different people at Facebook. One of them emailed and asked if I was coming with Dennis Yu? I was like why would I come with Dennis Yu? They said well isnt he going to be running your facebook campaign cause if so we have concerns. I was stunned… and said uh he is not touching my facebook account. They were like, “well that is the only reason we agreed to meet with him was about your accounts”.

I said “Better find a new topic”.

When I got back to the office I heard from a bunch of people that Dennis Yu was going to sue me and because Scott Richter was an investor in his company Scotts dad was going to represent him probono. That was a little troubling. Steven Richter is a BEAST in this industry and has no equal. That is the last guy I want problems with.

But this is when all the house of lies around Dennis started coming down (for me).

I have gotten to know Scott Richter a bit and I gave him call. We had about a 2 hour conversation. He said not only was he not an investor in Dennis’s company but he was about to kick the free loader out of his office building. He also said no way in hell his dad would be representing Dennis. A lot of other things were said that opened my eyes to Dennis and all of his bullshit.

Then one day out of the blue I get a call from this dating advertiser we were working directly with for some stuff on Facebook. They said Dennis had told them he was going to sue me and get a judge to issue an injunction against them so they could not do business with me and it would be in their best interest to shut me down …. strange…

Then one day all of my Facebook accounts were paused…. When I talked to Facebook about it they said Dennis had told them I was cloaking and sent them all kinds of docs and info about what I was doing with Facebook PPC. At first I laughed it off but then realized they were not going to turn me back on until they conducted a full investigation of my account(s). I provided Facebook with all the raw server logs and even logins to all of our affiliate accounts so they could match up all the clicks and see without any possible doubt he had made the whole thing up. We were turned back within 48 hours, got a bunch of apologies and stuff from Facebook. That outage probably cost us about 10-15k in profit or so… not cool…

At the same time I get a call from Neverblue ads, AzoogleAds, Clickbooth and other networks saying Dennis had contacted them with the same crap as the others.

The funny thing about these affiliate networks is most of them have been doing business with me since they have been IN BUSINESS. I have many many years business relationship + reputation with these companies. Dennis has been doing this affiliate thing for what? 6 months? To them he is just another affiliate clown who comes and goes.

A week or so later Dennis spoke at DK’s thinktank in Del Mar. His whole talk was about “How to be deceptive on Facebook and get away with it”. The joke of the event though was…. he had been banned (allegedly) for some time! But some people didn’t know and bought into the Dennis Yu bullshit train much like I did. I remember Bryn Yungblut coming up to me telling me I should have Dennis run my Facebook stuff… I just looked at him and was like man you dunno do you… He seemed to really be on the Dennis bandwagon so I just left it… I figured eventually he would find out for himself. Hopefull it does not cost him much time or money.

Funny thing is to my face Dennis is like mr nice guy asking if I need any help with anything and how he is working hard on some guests posts for my blog… Meanwhile he is knifing me in the back.

In the course of the next couple weeks everyone who had ever said anything nice about Dennis Yu had contacted me and told me they got burned and sorry they had said nice things about him. Most saying whatever he had told them was bullshit.

Then he posts this guest post on Techcrunch with one last ditch effort to get me banned from Facebook…

Cloaking – One of the largest Facebook advertisers (I’m not going to out you, but you know who you are) employs this technique to this day, using a white-listed account. Our supposition is that it makes too much money for Facebook to stop him. Believe me, we have brought this to Facebook’s attention on several occasions.

Ya so if you have not guessed it… its me he is talking about. I like how he doesn’t want to “out” me in public. I mean then he might actually have to back up facts… nice try weasel.

I actually never even saw the TC post until 2 days after it was originally posted. I started getting all these crazy random emails from people.

Everything from what a lying weasel Dennis Yu was to companies actually saying he never made NEAR the money he claimed. Once I saw the post I saw what all the fuss was about. Incredible.

I mean the actual companies Dennis said (on techcrunch) he made millions of dollars with wrote to me and said he was COMPLETELY FULL OF CRAP.

Everyone was kind of perplexed by Dennis would make a post like that. Really nobody knew the connection to me… Or the fact Dennis was a failure at Facebook advertising, banned (allegedly) , and super bitter.

He got his 5 minutes of fame and made a name for himself… unfortunately for him his name will always be associated with weasel.

Dennis is a very very smart guy and a brilliant example of a modern day con man. A lot of people don’t know the history of the term con man. It comes from “confidence man”. Way back in the day people would use the term a lot. They would ask you if you had confidence in them to purchase something from them.

In a couple short months Dennis Yu had gained the confidence at one time or another of about everyone in the affiliate industry.

He gained my confidence. I mean he had Markus Frind as his primary investor and told us SEOMOZ owner Gillian Muessig was coming on board to be their CFO. I had no reason to question their business relationship… Gillian was spending a lot of time with Dennis and the two of them including Plenty of fish owner Markus Frind took me and my team to dinner one night in vegas. I definatly had confidence this guy was legit…. He certainly acted the part.

Not only did he gain my confidence but he also gained the confidence of Shawn Collins to speak at affiliate summit on Facebook advertising (just shortly before he allegedly got banned). This was my fault. I did the intro and vouged for him.

He also gained the confidence of Dr. David Klein (DK) who allowed him to speak at his ThinkTank conference after I introduced them.

He even gained the confidence of Michael Arrington who allowed him to make a guest post on TechCrunch because the story, even though factually completely incorrect, was a great story for his readers. Maybe Dennis dropped my name to Mike and showed the guests post he has done on shoemoney.com? I dunno…

So whats the story in the end. Well I feel embarrassed. I fell for it. AND I was leveraged to get other people to fall into Dennis’s crap. I have heard people tell me Dennis used my name and told people he did everything from run our ppc campaign, to geeze just about name it. Each time I hear that I’m like damn… I’m sorry…

The good thing is that pretty much everyone that matters knows the jig is up. Here at Pubcon Dennis was brought up to me at least 25 times… and not nice things were said.

Evidently now Dennis has lost his most of his staff, his lease where he had his offices and is now working for some company in Chicago he was able to con.

In the end I apologize to you guys, my readers, for maybe giving you some confidence in Dennis Yu. In my 8 years in this business I have never had to make a post like this about vougeing for someone that is really a bad guy and has hurt a lot of my friends. Weasels like this really hurt the industry because it makes its just one more case of someone “full of shit” in our industry damaging it.

postscript: Markus Frind has clarified his involvement in Blitzlocal here.

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