SaaS Interviews with CEOs, Startups, Founders
826: AdTech: Bootstrapped to $1m-$10m With 20% EBIDTA Margin
28 Oct 2017
Chapter 1: What is the main topic discussed in this episode?
he's now launched use which is doing very very well in 2018 launched sorry 2008 launched from berlin 2011 moved into into the display ads business started selling to brands and agencies 2016 they're now over a million dollars in revenue but less than 10 million 15 folks on his team in vietnam taking between call it 15 and 25 percent to the bottom line reinvesting all but back into the company which he has bootstrapped which is great
Chapter 2: What is Yoose and how does it operate in location-based advertising?
serving about 30 agency customers today and making money on basically CPM arbitrage with a focus on location. That's why customers are choosing Christian also as a German accelerator. This is The Top, where I interview entrepreneurs who are number one or number two in their industry in terms of revenue or customer base.
You'll learn how much revenue they're making, what their marketing funnel looks like, and how many customers they have. I'm now at $20,000 per talk. Five and six million. He is hell-bent on global domination. We just broke our 100,000 unit soul mark. And I'm your host, Nathan Latka. Many of you listening right now don't have time to listen to every B2B SaaS CEO that I've interviewed.
If you want to get access to the database I
created with year-over-year growth rates customer accounts margins and many many other data metrics and data points you can go to getlatka.com here's the thing though this that database i keep it to myself it's so freaking valuable and to preserve the quality of the data and make sure that the people that have access to it have a true advantage i'm only letting 10 companies on each month
So we're full this month, but you can go to getlatka.com to get on the waiting list for next month. And look, there's big people on the waiting list. I mean, the biggest VCs you've ever heard of. You've probably heard of them. They're big, private equity, billions and billions under management. So it's an impressive waiting list. Go get on now at getlatka.com. Hello, everybody.
My guest today is Christian Geissendorfer. He is the CEO of a company called Joost, the leading experts in location-based advertising in Asia and Europe. He's an entrepreneur passionate about building businesses and leading teams.
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Chapter 3: How does Yoose generate revenue through CPM arbitrage?
He recently started in parallel to Joost a German accelerator in Southeast Asia, which is helping German startups to expand into that region. He loves living in Singapore and Vietnam, traveling the world and learning languages. He's fluent in German, English, French, and Spanish. Christian, are you ready to take us to the top? Wonderful. Hey, Nathan. Hey, thanks for joining.
So tell us what Youse does, what's the business do, and how do you make money?
Chapter 4: What year was Yoose launched and what were its early challenges?
So USE is a location-based mobile advertising company. We are experts in location-based advertising solutions and we help brands, global leading brands, to target people around specific geographic locations. So you take an airport for example, we help
fragrance brands when they launch a new perfume or if they are for promotion that people when they land at the airport or when they depart get targeted geographically with the GPS precise location to
get to people to know about the promotion at the stores and then this display ads inside mobile applications and the ad has also a dynamic copy so it tells you for example singapore changi airport terminal one go to the duty free store and find your special gift for example for the new fragrance how are you getting control over the inventory on the mobile app on the mobile device where you actually show that ad
So we're actually aggregating inventory from different mobile networks. So we're working with some premium publishers directly as well to place ads. But then to get the volume, we're basically working with any available major ad network, also from different inventories. And for travelers specifically, the Chinese speaking community is quite important as luxury travelers.
So we make sure we get all these. inventories aggregated so that the volume is big enough so that you're reaching also 10,000 or 100,000 of travelers every day and not only a very limited number.
And how do you make money?
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Chapter 5: How has Yoose's business model evolved since its inception?
It's an arbitrage at the end of the day. So we buy the inventory for the campaigns whenever we have campaigns running specifically to those locations, multiple airports, or also if you're a retailer with multiple location of the outlets, your branches, then we set up those campaigns, we optimize and it's a premium product we're selling here.
So our team does end to end from setting up the campaign and even can help us creatives and then Basically, yeah, delivering a great service, including reporting and optimization to the client. And that's where we charge for.
Okay, so you're essentially buying, I'm making this up, you're buying at a $5 CPM, you're selling for a $10 CPM.
Exactly. Not those exact figures, but... Is it tied to CPM? It's a CPM, yes, mainly. Got it. Sorry, let me just add on there.
Chapter 6: What is the significance of the German Accelerator for startups?
So it's mainly CPM as of today, but of course also in that environment goes more and more towards performance. So CPC or there's a lot of requests also for even cost per action, but that's with display advertising and not really easy to do. So yeah, the main model is CPM.
And what year did you launch the company in?
Sorry, which?
Which year did you launch the company in?
Yes, sorry. I launched in 2008 out of Berlin, actually, for two years and moved to Singapore in 2010. Moved the complete company because initially also we were doing a location-based couponing self-service platform, which technically worked, but from a business model point of view, it's very hard to scale. It's very hard to work with small retailers in a self-service environment.
So then in about 2011, 2012, it changed to the display advertising model. We moved from small businesses to media agencies and brands. And from there, we were basically building it up.
And give me a sense of size today. Like 2016, what was total revenue?
in 2016 well revenues is in a million digit figure um we have a team of 15 um the majority of the team is based out of vietnam and um probably important there to know also to anticipate also your question it's a bootstrap business uh so we didn't go for a venture funding round um yeah have you listened to the show you're anticipating my questions of course do you enjoy it
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Chapter 7: How does Yoose differentiate itself from competitors in the ad tech space?
absolutely let me ask you a question question christian why the hell do you agree to come on a show where you know the host is just gonna beat you up about numbers the whole time why do you come on because it's a fun game i'm happy to i love it i love it okay good so 2016 15 folks mainly in vietnam you've totally bootstrapped 2016 uh you did over a million bucks in revenue put a put a put a lid on that less than 10 million but more than a million
Yes. Okay, good. Fair enough. The business model is CPM arbitrage. Do you have any part of your business model that's SaaS, where you're selling reporting or things like that? Or is it all based on a percentage of spend or CPM or something like that?
Today, it's a pure CPM or a pure arbitrage model, where... working on a platform to be, and that's not necessarily SaaS, but it's all about audiences, profiles, and actually attribution. So where you can, I mean, look at location like the physical world cookie, so that We could then, well, we can today already retarget people who have been really in a store.
You have been at an airport based on your advertising ID inside your mobile applications. Or the other way around, if a retailer wants to attribute ad spending to store visits, we can do that as well. So that we can really say, okay, out of the $100,000 budget you spent, you have generated that many store visits of individual people in the seven days following the campaign.
And why do Christian, so I've interviewed so many kind of ad tech or marketing tech companies kind of in this space. And I always just wonder like with so much competition, why do your customers choose you?
We have this full service. So where we are really from not only advising on the campaign over helping with maybe even creatives, the dynamic creatives up to then setting up running optimization. So we go end to end.
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Chapter 8: What are the financial metrics and growth expectations for Yoose?
Also our segment is, A lot of the more second tier countries, so Southeast Asia and the countries all around Middle East. We run in Europe as well. So in total, we've run in over 60 countries, actually, campaigns. So that's where I think.
customers choose us because of that geographical focus and the geographical focus where we go more for the second tier market so that's where we're working with there was agencies and brands together and how many customers are you working with now today well It really depends.
Sorry, media brand, not the actual end, just the media brands, the agencies.
The media brands, the agencies. Well, at the end, we work with most of the major agencies, so the Group M guys and all those on individual campaigns. But then we work also a lot with second-tier agencies, the ones which you wouldn't necessarily know, I mean, at least not globally. But they are in a country like Myanmar or Cambodia. So how many total? Small agencies.
uh it's probably like 25 to 30 agencies okay and how are you landing these new customers so that's what yeah i want to just lead to we go a lot through partners sales partners basically where in the countries we work with those strong partnerships local experts usually it's smaller teams of 10 15 people who In other terms, you would call them probably resellers.
So they have a number of digital products they work with, with agencies, and they are reselling the location-based product either under the used brand, or we have a few white label partners as well, where they have their own strong brand in a country like Austria, for example, there's a company called About Media.
They are reselling our product as About Media Hyperlocal Targeting, but it's complete our service. The white label. It's a white label, yes.
Do you sell that to them? Like, do you make them pay a fee for that? Or you just make money based off, again, the CBM arbitrage?
we make the money together on the arbitrage.
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