Frank Addante's FounderBlog:
Starting startups by a serial entrepreneur.

I can't believe it's been a year. When Craig, Julie and Duc and I got together a year ago we didn't have a business plan, we didn't have goals... actually, none of us were even looking to start a company in the first place. So, today, on our first birthday, I ask myself where did this all come from? I'm just amazed by how fast this company has grown...

Immediately after asking myself that question, I remembered the very first meeting that the four of us had together. We spent a majority of our that meeting talking about the "kind" of company we wanted to build and the "way" we wanted to build it. We didn't talk about product or marketing or sales or finances... We talked about people, culture and vision. We committed that team development and people would be our #1 priority. If we could build the world's best team, they could build a world class company.

We wanted to make sure we enjoyed everyone we worked with and wanted to make work fun. Our vision was to attract a team of winners, entrepreneurs... a team of good people, and a team who had extreme pride in their work. We talked about all the ways we could keep the team motivated and continue to make culture a priority ranging from small perks and benefits to donating a percentage of our profits (and our time) to charity. The second thing we discussed was that we wanted to do something big and game-changing. We generally felt that the online advertising space needed a new wave of innovation. We knew it would take big risk and a big effort. We were committed to creating that wave. That was day 1.

Day 2, we went to work with those fundamentals in mind. And we did exactly what we committed to. Team development has been the #1 priority for us. I can't say this enough... If you build a great team, they build a great business. We have an unbelievable team here. They are all winners. I am so proud of everything that they have accomplished. And, I'm proud of the -way- that they have gone about accomplishing it. I feel privileged and honored to work with every one of them.

I would like to personally thank the entire team for being rock stars... I'd like to thank all of them for believing in me, Craig, Julie and Duc. And thank you to Clearstone Ventures for having the foresight and faith to invest in this crazy dream of ours...

One of my favorite quotes is... "The future belongs to those who believe in the beauty of their dreams." -- Eleanor Roosevelt

Year 2 starts tomorrow... Lucky me! I get to watch this incredible team of believers dream new dreams...

Labels: happy birthday

I was in the process of writing this post, and then I got this comment from a reader challenging my last post (particularly, our presence at ad:tech San Francisco.) While John and I likely disagree on management style and approach, we do agree on the right questions to ask (not the way of asking, but the questions themselves). Interestingly enough, we asked ourselves at the Rubicon Project these same questions prior to committing to the event and the launch. So, I have rearranged my post to directly address his remarks.

Here is John’s comment: “A few comments/observations on this disturbing post:1-Sending your entire team is crazy..some of them are very very junior in their experience level. How could they possibly engage with prospects in a meaningful way? Would be better off and save money hiring local booth talent.2-Carpooling in large SUV's with gas over $4.00/gallon? Quite expensive, and what a huge carbon footprint! Please, go hybrid. That is just shameful.3-Visit MarketingSherpa or other similar resources, they all say that trade shows and event marketing will not deliver the biggest bang for your buck. Those marketing dollars can be put to far better use that will deliver much better ROI and build your client base. Gimmicks like this don't.Maybe these things don't matter since you are flush with cash right now or maybe you are stuck in a time warp from one of your former gigs. Two words for you: BURN RATE” - John

Short version: this was by far the most successful event I have been a part of. Net results: 1,800 leads (and reached an estimated 3,000 prospects and 250 ad network partners.) It was a very high ROI event for us.

The only concern that I did have about our presence at ad:tech was that people might have the perception that we spent an excessive amount of money. Despite appearances, we did not. The team did an absolutely amazing job creating a strong presence, a presence that looked a lot more costly than it actually was. However, our budget was not out of the norm for a typical show presence. We spent wisely and were able to squeeze a lot out of the areas that we did invest. We only spent about 10% more on this show than I had with prior companies and we yielded 5X the results. It proved to me that a little extra effort, unique thinking and a passionate team can make a HUGE difference.

Bottom line: The show exceeded our expectations and goals and likely accelerated our business an additional 6 months.

As for John's comments, here are my responses:


“John: A few comments/observations on this disturbing post: 1-Sending your entire team is crazy..some of them are very very junior in their experience level. How could they possibly engage with prospects in a meaningful way? Would be better off and save money hiring local booth talent.”

This is a team that pulled all-nighters for 3 weeks trying to get this release out. So, I wanted them to see the direct results of their hard work. It was a motivator on one hand (they had to be there in front of prospects and stand behind the product they built) and it was rewarding on the other hand.

There is not a single person in this company that I would not (proudly) put in front of a customer. And, I'm happy to say they proved me right. Every single person in the company meaningfully engaged with prospects. They were well trained and knowledgeable. The results speak for themselves. Not only did they do a fantastic job engaging and bringing home a wealth of leads (avg. of 50 per person,) they also learned a lot more about our customers' needs. We say that our customers are our #1 priority. And while we do speak to them on the phone every day, it was very valuable and impactful for our team to meet with them face to face. Even the engineers were able to engage with real customers and prospects about the product, and to see them using it first hand. How often do you see engineers in a booth? That touch point was priceless and the end result will be a better product.

Local booth talent? No way. Never. It’s the worst thing you could possibly do. We do not believe in hiring local booth talent, we believe in engaging with our customers directly. In fact, we received many compliments for doing just that at ad:tech SF and ad:tech NY. Myself included… someone stopped me while I was passing out water bottles in NY and asked what company I was with (assuming I was hired to pass out water bottles), I said, “I'm the CEO”... It resulted in a customer (and set a an example for the rest of the company.) Engaging directly with our customers - that kind of ROI cannot be beat.


“John: 2-Carpooling in large SUV's with gas over $4.00/gallon? Quite expensive, and what a huge carbon footprint! Please, go hybrid. That is just shameful.”


The environment and cash management are very important to us. We carefully considered these factors as well. We do our best to be green, though, admittedly, we could do a better job, but we do the best we can. As an example, we did away with water bottles in the office and instead have glasses and a Rubicon Project re-useable water bottle for everyone on the team (saving thousands of hours of energy every month). In this particular example, the carbon footprint of flying everyone on airplanes was greater than actually driving.

As for cost, originally, we were going to bring 20 people (sales, marketing, business development) to engage with customers and partners. Flying 20 would have cost about $350 per person (between flights, taxi's and parking,) approximately $7000. The cost of driving 40 people was $6700 (less than the cost of flying 20.) With more than 9,000 people attending ad:tech most of the ad networks that we partner with were going to be there already and thousands of prospects. As a whole, it is a huge cost savings play for us because we don't have to fly to see them individually in their respective cities - having them all in one place is much more efficient. And, because of the efficiency of meeting many of our customers and partners in one place, we were able to reduce our travel budget (to meet with customers and partners) for the rest of the year by at least $5,000 (estimated ten trips times $500/trip including airfare, hotel, taxi and meals).

Further, having teams of 7 in cars together was highly productive. Not only did they bond (great for productivity) but also it was 12 hours (6 hours each way) that the teams had a chance to talk about important business-related issues. Brainstorming led to great ideas being generated during the trip. We believe very strongly in active communication, in fact, I think it has been the largest contributor to why we have been able to do so much, so fast.

Oh, and by the way, even though the carbon impact was less than flying we did purchase carbon offsets to counteract the impact of those vehicles. (Would you believe the carbon offset cost was less than $200 for the whole trip?! I paid for it personally, not with company funds.)


“John: 3-Visit MarketingSherpa or other similar resources, they all say that trade shows and event marketing will not deliver the biggest bang for your buck. Those marketing dollars can be put to far better use that will deliver much better ROI and build your client base. Gimmicks like this don't.”

Interesting. This is the third company in which trade shows have been the single largest source of leads for us. The key is to execute well at these shows, however, I would agree that most companies do not. The key is to measure and metric the success of these shows like you would any other lead generation activity. We had a goal for this show of 500 leads. We brought back 1,800 and probably touched another 3,000 indirectly.

“John: Maybe these things don't matter since you are flush with cash right now or maybe you are stuck in a time warp from one of your former gigs. Two words for you: BURN RATE”

Given that we spent half as much money as our original plan and accomplished twice as much in half the time... We understand this well. We are a highly metrics and ROI driven organization. When we spend, we spend wisely. We consistently exceed our top line targets and have spent less than our plan. But, thank you for the reminder, it is always important to remember.

To summarize…

Things we did to make a big splash without spending big cash:

1. Designed a slick booth --ourselves-- Marwan, our VP of Brand and Creative, literally designed the booth on the back of a postcard at a restaurant in NYC after ad:tech NY. He did an amazing job! (see pictures below)
2. Do NOT hire local booth talent - it is expensive, ineffective and insulting to your brand (see: Why Booth Babes Are a Mistake)
3. We brought 40 people gave them branded clothes - it was like having 40 walking billboards (avg. cost per person: $200)
4. Shared hotel rooms (cut costs in half), stayed at the Holiday Inn (budget hotel), carpooled instead of flying (less expensive)
5. Threw a party, largely sponsored by StrongMail Systems, Clearstone Ventures and Om Records (big impact, low cost) – thank you to our sponsors!
6. Re-used materials (such as the video from our website)
7. Did very little printing (saves trees and cost.) We kept collateral to one half-sheet which featured a “free music” card (which, by the way, the free music was sponsored, no cost to us - thank you to our partner, Om Records!)
8. Focused on the primary goal: get leads (we brought home 1,800 leads in 2 days, almost half of what we acquired in the past 6 months)
9. Trained the team well (our people, engaging with real customers and prospects) - priceless.


Thanks for teeing up this post, John! I was having a hard time getting it started – sometimes it is hard to get motivated to write and finish a post. I appreciate the thoughts and am glad to hear there are other people out there that are passionate about the environment and the success of other businesses.

Today’s lesson(s):

1. When you spend, spend wisely.
2. Make sure everything has a goal and measure against it.
3. And… do not ever hire anyone that you wouldn’t feel comfortable putting in front of a customer.

Labels: ad:tech, booth, environment

Although I try to keep this blog very focused on entrepreneurial lessons and stories, a lot of people have requested I share some of Rubicon Project's news on this blog. I've been trying to figure out how I can balance both without compromising the lesson-oriented posts. So, I'm going to label any Rubicon Project news with "Rubicon Project" first in the title for easy identification. I'm copying a blog post that I wrote on the Rubicon Project website into this post (below).

Short version - we launched a Free Ad Network Ad Server today, a literal first for the industry. You can read a bit more about it in the Wall Street Journal ("Rubicon Project Goes Live") and MediaPost ("Rubicon Project Takes on Google with Free AdServer") articles. Or read more below or click here...

And, come visit me at ad:tech San Francisco (booth #6166), I'll be there with the whole team this week (see below). We'll be serving espresso in the morning and beer in the afternoon along with giving away cool tunes from our partner Om Records.

Oh, and the lesson for today's post: get yourself a rock star team, it makes all the difference in the world!

Gotta run... Hope to see you at ad:tech!

~~~ My Post from the Rubicon Project Blog ~~~

Greetings everyone! I'm Frank Addante, CEO and one of the founders of the Rubicon Project. Today is a very big day for us. Our whole team is excited to finally unveil a number of things we've been working diligently on the past three months. But first, I have to tell you, I am incredibly proud of what this team has accomplished in such a short period of time. For example, our engineering team has, literally, been working around the clock for weeks now. And even though we all could use a long nap the atmosphere around the office has continued to be energized -- even at 4am after multiple rounds of all-nighters. The commitment to building a world-class product is unshakeable.

We are quickly approaching out 1-year anniversary since starting the Rubicon Project (see my original blog post) which, when I think about it, is truly amazing.... On one side, I can’t believe how much we’ve accomplished in such a short period of time: we've served 11+ billion ads across 750+ certified websites, developed deep relationships with 62+ top ad networks, we've built a stellar team of 40+ people and we've forged and created a new category - Ad Network Optimization. On the other side, like they say, time sure flies when you're having fun-- And we are having a lot of fun!

The main intent of our private beta was to learn and test our theory that websites need a better solution to manage and generate revenue from ad networks. We were overwhelmed with the positive response. We originally planned to try and sign up 500 websites for the private beta over the course of 6 months. To our surprise, more than 500 signed up the very first day, with 5000 websites having signed up since. We’ve learned a ton and are now launching products and services based on those learnings as we move into phase II of our mission.

I want to bring you up to speed on all of the news from this week and last, starting with today.

This Week:

Free Ad Network Ad Server
We launched a Free Ad Network Ad Server today (see press release). Ten years ago, I created one of the first ad servers (it was called adMonitor). That is where I first worked with my co-founders Craig, Julie and Duc. DoubleClick was our #1 competitor and the 800-pound gorilla at the time. adMonitor grew to be the second largest ad serving platform behind DoubleClick who later acquired it after our IPO. Back then, 100% of ad space was sold by in-house direct sales teams (or exclusive ad sales rep firms). Times have changed. Today, up to 80% of ad space goes unsold directly. And a lot of websites depend on ad networks for 100% of their revenue. Ad servers were designed for direct sales, not for managing ad networks. Websites have told us that their ad servers do not help them efficiently manage ad networks. In response, we created the industry’s first free Ad Network Ad Server - specially designed for managing ad networks. I believe this product will help ad networks and websites work together more efficiently - creating a better growth opportunity for both. Click here to check it out...

New Ad Network Optimizer Release
We have made significant enhancements to our core product, our Ad Network Optimizer:

• Smarter Algorithms: We have upgraded our algorithms helping to boost CPMs even further, increase fill rates and kill default ads (unpaid or very low paying ads).
  
• Ad Quality Screener: Websites have told us that ad quality is very important to them. In addition to the ad quality preferences and filters, we have added the ability to quickly screen ads from ad networks and pause unwanted ads.
  
• Guaranteed On-Time Payments: Ad networks have varying billing and payment terms. This is a big challenge when working with multiple networks. We now centralize the billing so websites get one simple check from us -monthly- and we guarantee the payments come on-time even if the ad networks pay late.
  
• Reporting: The entire user interface has been upgraded and there are many new reports based on all of the great feedback we've received.
  

Click here to learn more about the Ad Network Optimizer...

I don’t know where to begin to try and explain how much work has gone into this release. Both our engineering and market team's have been hyper-focused on delivering a high-quality product that is a direct result of customer feedback.


Last week:
JT Batson, who leads our publisher team, already addressed a number of our new initiatives in last week's post, so I will keep this brief.

• Q1 Ad Network Landscape, Outlook and Trends: We have assembled our learnings and produced this 21-page educational report for the industry. (download the report...)
  
• Golden Eggs Video: A simple, fun way to tell the complex story of the changing online advertising space the past 7 years. (see the video...)
  
• New Website: Our business is driven by technology and data. We designed a site that reflected the real-time, dynamic nature of our business.
  
• Ad Space Certification program: We are committed to helping ad networks grow their business. Ad networks (and their advertisers) have told us that if we can provide them with better classified inventory and assure it's safety and accuracy, that they could do a better job selling and converting that inventory. As a result we launched the industry's first Ad Space Certification program-- a win-win for everyone. (learn more...).
  
• Ad Space Finder: The more visibility we can provide ad networks into available ad inventory the more effective they can be. We now provide real-time visibility into the ad inventory of our website customers via the Ad Space Finder (check it out...).
  

Now in Public Beta:
Also, we have officially moved from private beta to public beta. What’s significant about that is we are now letting everyone in, not just the 750 websites we accepted into the private beta. The more websites that join, the more data our technology can use to analyze to make the right matches between ad impressions and ad networks and the greater exposure all inventory gets to more ad networks and more of their advertisers.

I know this is a long post. But, just writing this all out for the first time reminds me how much work the team has put into making this a big success for our websites and ad network partners.

The momentum and excitement are what's keeping us going after many, many late nights. It’s nice to see people rooting for us and seeing what we’re doing being validated in articles in the Wall Street Journal ("Rubicon Project Goes Live") and MediaPost ("Rubicon Project Takes on Google"). The team is running on adrenaline in place of sleep and this kind of fuel keeps them pumped.

One last thing...

Come visit us at ad:tech San Francisco this week!
Our entire team is going to be at ad:tech San Francisco this week for our first time exhibiting at a trade show. Yes, I did say the entire team (all 40 of us)! Why? Well, we always say our customers and partners are incredibly important to us. So we packed up the entire team and carpooled up to San Francisco (from LA.) We thought it would be great for everyone in the company to meet our customers and partners in person. So, we'll all be here! Hopefully you'll come out to see us, we'll be easy to find -- just look for people wearing black Rubicon Project shirts and a smile! Stop by our booth #6166 for some cool, free tunes from Om records or an espresso in the morning and beer in the afternoon!



(PS - don't worry websites, should you need us the team will always be available. We covered our bases with a scheduled set-up for dedicated customer service.

That's all I have for now... I'd like to personally thank all of our website publishers and ad networks for all the support. We're committed to what we're doing and your proactive support means a lot to us. And, of utmost importance to me, I'd like to extend my deepest thanks to my team - your passion and dedication inspire me every day!

We're looking forward to the future!

Frank

Labels: ad network ad server, ad network optimizer, ad:tech, adtech, media post, om records, rubicon project blog, wall street journal

Check out this video and then read the rest of this post:



I talk about simplicity all the time. In general, I think a lot of companies focus too much on "how" they do things instead of "what" they do. It's an easy trap to fall in, particularly in startup companies that are so product focused. We get so hung up in the product and the technology and forget to describe to people why they should use it in the first place.

As an example, at the Rubicon Project, we are forging new territory. Along with this comes a very complex story to tell. We constantly struggle with trying to find simple ways to tell the complex story of how online advertising has evolved over the past 10 years.

Most people understand that the online ad market has grown significantly (to $27Bn in 2008). But most do not recognize how the landscape has changed and how it affects the challenges websites face when trying to monetize their ad space. I could tell you about the very complex technology that heavily leverages data and smart algorithms to solve this problem and all the C++, JavaScript, AJAX, blah blah blah that comes with it. And, I could talk your ear off about the 10+ billion ads that we've optimized for over 750+ websites across 62+ top ad networks and the mounds of valuable market data that we've collected as a result. But, none of that matters to you unless I can convince you "why" we need to exist in the first place and tell how this could help you achieve your business goals.

Today, we launched a number of tools for the online advertising industry. They range from simple and entertaining to in-depth and detailed. They are all geared around further educating the market:

1. Video (above): the Rubicon Project presents: In search of online advertising's Golden Egg (an entertaining and educational video on the changes in the online ad space)
   
2. Market Report: 2008 Online Advertising Market Report - Q1 Ad Network Landscape, Trends and Outlook (a very detailed report based on our analysis of billions of ads delivered between ad networks and website publishers) [click here to download a copy]
   
3. Ad Space Certification program: our first move toward creating an industry standard to ensure the safety, accuracy and trust for ad networks (and their advertisers) when placing ads on website [see Press Release]
   
4. New Website: our business is technology and data driven, we redesigned our website to illustrate this by providing real-time data and access [check out the new site and our new Ad Space Finder]
   

There is a lot of deep, complex information behind each of these. So, to keep things simple, we thought it would be best to produce a video with a fun, simple story to describe what we do. I have embedded it in this post here:

Bottom line: you need to find a balance between sharing the complex information (e.g. our Market Report) with a simple way to tell your story (e.g. our Golden Egg video above)

We, at the Rubicon Project, moved into new office today. It is a very exciting day for us. Actually, liberating would be a more appropriate word. Before, we had 40 people squeezed into a 2,000 square foot office, designed to fit 15 people, max. Today, we moved into a 20,000 square foot office, 10X the size of the previous one. Personally, I believe that work environment is a critical factor for team productivity. Especially in a startup company where people spend most of their days, and many, many nights in the office...

I did a posting on our original office 9 months ago. There was a lot of thought that went into that first space, even though it was relatively small. That extra thought paid off. People that visited the office always took notice and commented about the welcoming, energetic feeling. We were able to create a very open environment that encouraged very active communication. As the office became overly crowded, that communication grew stronger. And, while it wasn't the most convenient with the space limitations, it contributed to the strong culture that has developed here at the Rubicon Project. We knew it was a challenge, but we improvised. For example, on sunny days (much thanks to Los Angeles weather!), we pulled chairs outside into the parking lot and created make-shift conference rooms (see photo). We sure felt the space squeeze on a rainy day!



The tight space added to the charm. So, we wanted to be careful not to disrupt the culture. As with our first office space, we put a lot of thought into Office 2.0:

Style: "24"
The new office is where they filmed the first season of the show "24". Jack Bauer's office is prominently displayed in the middle of the space. Yes, of course we named it the "Bauer Conference Room"! The other conference rooms were named in memory of (President) "Palmer" and "Edgar". In the middle of the office is a giant tented theater. We have learned that before filming 24, the space was used for the production of the movie, Titanic. The theater room was a screening room. We turned it into a conference and team meeting room, for our weekly all-hands team meetings. For those that watch the show 24, we named the theater conference room "CTU".



Communication & Productivity
In the new space, there are over 20 walled offices with doors and a very large, open area. We could have easily put everyone in an office. Instead, we chose to put everyone in the open area. And yes, by everyone, I include myself. We wanted to keep the communication flowing. But, we also realize that it could be anti-productive. Particularly when it comes to phone calls. So, we turned all of the offices into phone rooms and conference rooms that are assigned/dedicated to each department. These phone/conference rooms can be used for team meetings or people can jump in a room for an hour or a few hours and use it as their own private office. We thought it was a nice balance. Sitting here for about 5 hours now, it was the right decision. I've learned more sitting in the middle of the office in the past 5 hours by absorbing the background conversations than I would have in 2 hours of meetings.




Fun
Since we spend a lot of time here, we wanted to create an environment where the team could kick back and chill out a bit. So, you'll find a lot of huge lounge chairs, sofas and a separate bar/play area. We also installed free vending machines and expanded our Wii Lounge, added a pool table, ping-pong table, dart board and foos ball table. (Disclaimer: see bullet on "budget" below, we are not going to be one of those cliche dot-com stories...) We have a huge parking lot, so we also picked up a portable basketball hoop. We like to balance hard work and fun with healthy living and exercise. (Last week, we had a team kickball match at lunchtime, my team lost - this time!)



Urgency
We are an extremely metrics driven company. We chose to mount flat-panel screens around the office with our Mad Cash Meter. It is a real-time view of how many ads we're optimizing and how much money we're generating for our website customers. We also use it to track our goals and keep the company updated on group progress. The visual screens are a constant reminder to keep us all very focused on our #1 goal of helping our customers make mad cash from the ads on their site.



Events
We hold a regular event called Thursdays in the Mix. We've been doing them at local venues (bars, etc.). The event is focused on Southern California business networking and the advertising and technology industries. The events usually attract 300+ attendees and we usually have to limit the guest list due to venue size. Going forward, we are going to host the events at our office which will allow us to expand the guest list. We setup a bar area to support the event and the office has a huge courtyard which is perfect for entertaining. There's 20,000 square feet of office and probably another 20,000 square feet in the enclosed courtyard.



Location
The new office is just 2 blocks away from the old one. It certainly made the move easier. It is near Santa Monica, which is quickly becoming the technology capital of Southern California near companies like Yahoo!, Shopzilla, Fandango, LowerMyBills.com and even MySpace.com started here. It's a great, central place for us to recruit new talent from many area of LA.

Budget
Here's the best part (and the lesson). Relatively speaking, we spent very little money furnishing the space and making it our own. By keeping the area open, we avoided having to buy expensive cubicles which could run $2k - $3k per person. Instead, people have desks that cost $150. We bought our phone/conference room furniture at IKEA for less than $300 per conference room. For the theater room, instead of buying 50 chairs for $100+ apiece, we opted for black and red (our company colors) cubes for $33 from Overstock.com. We painted the space and added our signs and tagline to the walls which wasn't very expensive. Everything we bought was either from IKEA, Target, Craig’s List or discount furniture stores. Overall, we spent about 25% of "normal costs" to setup our space but feel like we got 5X the value!



The team is totally jazzed about the new office. We really wanted to make it nice for them. They work extremely hard and are committed to building a great business. We're looking forward to our new "home". We strived to do something unique and stellar without a stellar price. I feel like we struck a great balance.

After announcing our $21M in funding last week, a number of reporters reached out to us for stories they were writing about the economy. We were featured in the L.A. Times, and the article did a fantastic job capturing the essence of what we do, and our culture. On the flip side, I was quoted in the N.Y. Times this past weekend in a story on the front-page of the business section that drastically misrepresented the thoughts I had shared.


Photo from L.A. Times article "Seeing 'mad cash' in online advertising"

During the interview, I felt that the reporter was trying to "lead" me down a path to better “fit” into his story. I felt that he was trying to get me to say that we raised the $21 million out of fear that there was going to be a recession. I strongly disagreed, noting that the funding had closed before talk of a recession became all the rage (while we announced it last week, the funding actually closed mid-December). Further, I stressed that we raised the money because we were chasing the huge influx of demand from the 3,000+ websites that signed up for our service.

But, in between the time of the interview and the story being printed, Microsoft made a bid for Yahoo! The reporter not only had to alter his original story (and focus), but he had to combine it with a story his colleague was writing about the Yahoo/Microsoft news. Unfortunately, in doing so, my comments were positioned out of context and false information was listed as fact. I can’t rightly say he “misquoted” me because I did make the exact statements I was quoted on, they are just out of context and positioned as supporting an argument I don’t actually agree with. Clever editing, some might say.

One example: he wrote that L90, one of my prior companies, filed for bankruptcy protection. Not true, never happened. In fact, he even emailed us on that point to do some fact-checking and we corrected him. He said he didn't receive the email (We are implementing StrongMail to make sure our emails get delivered. I wish we had setup StrongMail sooner! StrongMail is one of my other companies, see Startup 5.0.)

The reporter is one that I have great respect for. So, I suspect that this happened because the story had shifted last minute.

So, what do you do when a reporter you admire misrepresents you? (and you don't have a blog, like this one, that 6,000+ people read?)

Well, you need to treat your relationship with reporters just like any other relationship. Be honest. If you feel like you were misrepresented, you (or your PR team) need to call them and tell them just that. Reporters need news to do their job; you need exposure. It's a give and take relationship. So, there needs to be trust both ways. You need to trust that the reporter will accurately represent your position.

A good friend of mine, Peter Sealey (former Chief Marketing Officer of Coca-Cola, President of Columbia Pictures and professor at Stanford and Berkeley), gave me the following advice: "Before the interview starts, you state that your comments are on background only and not for attribution unless and until you approve the specific quotes. You will lose a few interviews but the ones that go out will be accurate." Peter is recognized as being one of the greatest marketers of all time and is an expert that reporters very often turn to for their articles.

Pete's advice is sound. However, startups are generally not in the position to place demands on reporters. Most startups are hungry to get press attention. But, you do have to be careful. In general, the pros outweigh the cons, but always make sure you're working with a reporter that you trust and try to build a long-term relationship with them. There is nothing wrong with asking a reporter up front what angle he’s really going for, or stopping in the middle of an interview to clarify. This way you don’t end up feeling tricked and the reporter knows you want to give him what they need and that you’re paying attention.

Bottom line: My advice is to be very careful with what you say. Be as clear as possible and treat your relationship with a reporter as you would any other business relationship. Work hard to understand exactly what they are trying to make the story say and above all, follow your instincts. If you sense that what you’re saying is falling on deaf ears, speak up, ask questions and clarify what it is the reporter is after.

So, was it worth it? The answer is yes. Having exposure in the N.Y. Times, even though it wasn't perfect, resulted in a lot of great attention for us and a lot more sign-ups for our service, adding to the 3,000+ websites that have signed up already.

Labels: frank addante, LA Times, lobby video rubicon project rubiconproject ryan byrne video youtube defamer, mad cash, NY Times, pete sealey, Reporter

What a way to start off 2008! First, we are honored with a number of awards (more on this later)... And today, we at the the Rubicon Project announced that we have raised $21 million in total financing (see press announcement). We are very excited, as this is a huge vote of a confidence for the company from investors. It's not everyday that a company that has been around for only 8 months secures this much money. It seems crazy that it's been that short of a time. If you look at the company in terms of product, customer traction and performance, it might look like a company that's been around for years. More than 3,000 websites have signed up for our service and we've optimized over 4 billion ads in the past 13 weeks following our beta launch. Our customers have seen anywhere from a 33% to a 300% lift in revenue using our service (while doing a lot less work). It's clear that the demand is strong, now we need to deliver for the 1+ million sites on the Internet that make money by selling ad space. This new funding will help us move faster and more aggressively.

So, how did it happen? Well, it all started with a trip to Hawaii...

A few months after starting the Rubicon Project, I received an invitation to a conference called The Lobby. The invitation-only conference, meant to be a meeting of the minds for the Who's Who in technology was organized by David Hornik a venture capitalist with August Capital. At the time, I was right in the the thick of the Rubicon Project's development. The company was still in "secret-ninja" mode and we weren't talking about what we were doing. In fact, we didn't have plans to talk about what we were doing until we launched the beta, which was originally expected to be January, 2008. Being that I wouldn't be able to talk about my current experiences, my first reaction was to not go to the conference. My wife, Rita and my co-founder, Craig convinced me that I should go as I had plenty of experiences and insights to share from my previous companies. Plus, Rita and I tossed around the idea of staying the weekend following the conference to turn it into a mini-vacation, seeing as how we hadn't taken one in a while and it was long overdue.

I felt guilty by the prospect of leaving the team for a whole week! Especially since the team was pulling all-nighters, sleeping in the office trying to get the product launched. I am very metrics and ROI driven and I just couldn't convince myself of how this conference was going to benefit the company, being that we were being quiet about our plans. How was I going to justify going to Hawaii while they were all working so hard?

Well, after accepting the invitation, we ended up launching our beta product far ahead of our original plan. The launch happened 2 weeks before the conference. Now, at least I was going to be able to talk about what we're doing. But, the launch brought on a massive amount of unexpected demand. 500 websites signed up for our service in the very first day, a target that we had set for April of 2008 (6 months later) and hundreds continued to sign up by the day. We were massively understaffed. I faced a decision of going to Hawaii or staying to help the company chase the incoming demand. My co-founder, Craig, who's motto is "brut force it", said "Go, Addante! We've got it covered. I know you and I know that you'll find some way to extract value from it."

So, I went to Hawaii, feverishly checking my blackberry and calling my assistant Mallory to make sure everything was OK... Everything was fine; the team, as they always do, found a way.

One of the days at the conference, we were grouped into teams. One of my teammates was Raj Kapoor of Mayfield Fund. Mayfield was one of the very few top venture capital firms that I didn't already have a relationship with. Raj, the founder/CEO of Snapfish, was a young guy that seemed to be very smart and had a lot of energy. We instantly hit it off and spent most of the day talking about building companies and the online advertising space. We also spent a lot of time talking about the Rubicon Project. I was trying to pick his brain and get feedback, he was trying to learn more about the space. It was a great conversation that lasted about 6 hours on and off.

The conference ended. Rita and I were going to begin the mini-vacation part of our trip. Raj had an invited us to go snorkeling before he left; along with Heather Harde (Rita's former co-worker at Fox and now the CEO of TechCrunch) and Ted Rheingold and John Vars the founders of Dogster. Raj and I spent a few more hours talking about the Rubicon Project, then he said "Are you looking to raise venture capital?" I said, "not right now, we're focused on our customers and doing a great job for them, trying to catch up with the demand." A lot of investors had been reaching out to us after our beta launch. I continued, "fund raising would be a distraction and we don't need the money." While on the snorkeling boat, Raj asked Heather and the Dogster founders about the challenges of monetizing their ad space. Their responses supported exactly the problem that we're solving at the Rubicon Project. Raj told me to give them "the pitch", so I did -- in my bright yellow swim trunks, a snorkel on my head and eating goldfish crackers. We've all heard of "elevator pitches" before, but this was taking it to a whole new level...

Raj said, "Look, I know the space. I'm aware of the problem. I just did some real-time due diligence. Come in and pitch my partners, it will only take one hour of your time." He committed to making a fast decision after the meeting and asked that, in return, I agree to an exclusive conversation with them for just a couple of days (until I returned to the mainland for the meeting). Normally, I would never agree to such an arrangement. But, Raj seemed to be a stand up guy and I liked his style. I also figured that I was going to be in Hawaii and wouldn't have much time to talk to anyone else anyway. It turned out that while I was in Hawaii, the word on the Rubicon Project was spreading fast -- and when I returned to my inbox, it was flooded with emails from investors. But, I was committed to honoring my verbal agreement with Raj.

The rest is history... We ended up agreeing to a deal with Raj and Mayfield within a week (it actually closed in December). I felt a strong connection and great energy from the entire partnership at Mayfield. It was clear that they knew the online advertising space very well, especially having invested in companies such as Revenue Science, AdKnowledge and Consorte Media. I thought that they would be a great complement to our existing investor, Clearstone Venture Partners, who had the original vision to believe in the company and the team. Clearstone, especially Sumant Mandal and David Stern (our board members), has been incredible to work with. Their support has been instrumental to the success of the company.

As part of the deal, we wanted to carve out part of the round for strategic investors. We ended up bringing in IDG Ventures Asia, Stanford, Berkeley and Matt Coffin, the former CEO and founder of LowerMyBills.com. Matt was one of the biggest advertisers on the Internet and one of DoubleClick's biggest customers. IDG will help us with international expansion. Stanford and Berkeley will be helpful with recruiting efforts.

All in all, we are very excited about this next step. We are solving a massive, massive problem for the online advertising industry. Raising $21 million is a big commitment, both to our investors and to the team. We decided to take in the additional capital because we have a big vision and the market has shown that it's very supportive of that vision. To date, more than 3,000 websites have signed up for our beta. We've grown the team to more than 40 people. The product has been performing very well for our customers, as such, all of the inbound demand has been word of mouth. And, the team is executing with fire and tenacity. Momentum is on our side and personally, a big part of our decision was driven by the need to move fast and never slow down. So, that's exactly what we're going to do!

As you know, I always like to wrap a lesson into every one of my posts. In this case, I have to tell you that if it wasn't for the confidence in my team, there would be no way I could have afforded the time to go to Hawaii at such critical time. Another lesson, I suppose, is that not everything has to be about metrics and ROI (team: if you are reading this, please feel free to forget I just said that). To steal a quote from my wedding vows, "luck is what happens when chance meets opportunity." Sometimes it's just about taking advantage of an opportunity that presents itself to you. That's one part of the lesson... the second part is to make sure you have a good "snorkeling pitch" to go with your "elevator pitch"! =)

By the way, in case you were wondering how the mini-vacation went. Well... as luck would have it, when we got back from snorkeling 9 fires were started on the island and we had to evacuate. Serves me right for taking a day off, lesson learned!

As a side note, that video I created on building companies in Los Angeles versus Silicon Valley was made for The Lobby conference. Not sure if that factored into Raj's decision. But, it's great to see the divide between Nor. Cal and So. Cal closing. More and more venture capitalists from Silicon Valley are coming to Los Angeles to find innovation. This funding announcement is good for Los Angeles and it's great for the online advertising industry, a space that's been lacking innovation for some time now.

OK, I gotta get back to work now...

PS - And more good news to share... We have been so fortunate and are very thankful... Due to your strong support, we won the Twiistup "Best Showoff" award (the event hosted by Perez Hilton and Shira Lazaar), and we were selected as one of the top 100 private companies by AlwaysOn and finally, were also picked as a finalist for the Price Waterhouse Coopers Entretech Award. I'll be in NYC this week presenting at the AlwaysOn OnMedia conference before our press/media tour -- if you're going, I'll see you there!

Labels: 21 million, alwayson, entretech, financing, funding, mayfield, onmedia, twiistup, venture capital