Full transcript: Gareth Davies on London Real
0:29 Behind the innovation, locally filmed, locally sourced. Silicon Real. It’s about the people. Let’s do this. This is Silicon Real, the weekly talk show dedicated to the people of the London technology startup scene.
0:47 I’m Brian Rose. I also host London Real, which is a similar trialogue format. We get three people in the room, try to figure some things out. We’ve had British MP George Galloway in here. We’ve had spoken word artist Sully Breaks and author Graham Hancock.
0:58 So check that out if you like. But we’re here to talk about tech. My co-host is Colin Pyle, entrepreneur of the online language school Lingos. You’ve got Crew Cafe. You finished your Kickstarter.
1:09 Yep, you killed it, right? Yeah, d… I don’t know if I’d say kill it, but yeah, we gave you a weird end date. It was like 27th of December. 27th of December.
1:18 Yeah. Okay, you wanted to get it done before the new year. It was just 30 days from when I started. Okay, I didn’t put too, too much complex there. No, no secret strategy, but yeah, so finished.
1:30 Things are going great. You know, back in the New Year, and we’ll have our pods ready in a few weeks. When do I get my coffee? Cuz we’re going to start serving in here soon. Very soon.
1:38 Very, very, very soon. Okay, and the, it’s got the biodegradable pod, and that’s all happening. Yeah, the first batch in the next couple weeks will be recyclable plastic, unfortunately, because those are already done, and then biodegradable will come in February. Okay, immediately. Yeah, awesome man.
1:51 Thanks for being here. Our guest today is Mr Gareth Davies, who is the co-founder and CEO of Adbrain, which is the world’s first real-time multiscreen scen advertising platform. You’ve written the article, “Mobile, a Marketer’s Nightmare.” I can only imagine. You worked at a Google media platform, DoubleClick, for many years.
2:10 You guys just raised, I think, a million and a half dollars last year in seed funding, correct? Welcome to Silicon Real. Thank you very much for having me, guys. You know, thanks so much for being here. You know, I don’t know about you, but I see, you know, mobile ads popping up on my phone every now and then.
2:24 I see it mostly on the New York Times website, you know more than anything, and I must say I noticed them like much more than I would. True? I’m sure. Well, you were at DoubleClick for many years. I’m sure I tune out most of the ads I see on the computer screen but the mobile ones, I’m first of all curious who’s advertising, and like, I’ve even clicked through a few times, but anyways, I wonder if you could tell us the state of the union right now in mobile phone based advertisement and where we’re going.
2:48 I think everyone agrees it’s got huge potential. Absolutely. You know, so it’s interesting. I think this is a revolution that’s being led ultimately at the consumer level, right? So yeah, consumer adoption of mobile devices is just blowing up, right?
3:01 I mean, I think, you know, I won’t reel the stats out at you guys, but it’s you know, fair to say that IPS are rapidly moving across to mobile devices, premium publishers. So you mentioned the New York Times guys, like the Mail Online, have gone on record saying that now 50% of their total digital traffic is now coming from mobile devices. You know, you see stats saying 12 to 25, 20-25% of consumer time is spent on mobile devices, and you know, amazing for consumers, right?
3:28 There’s so much choice, content evolving. You can get information that’s contextually relevant. Publishers can now serve you content based on your location, your environment, so data that sits behind this is really powerful. When it comes to advertisers, though, it’s tough, right? I mean, it’s, you know, we’ve got 15 years plus of digital marketing where accountability, performance, results, everything’s measured basically by a cookie, right?
3:51 So the whole industry is predicated on the ability to track and identify ad spend. So, you know, marketers in the digital world, if they use DoubleClick or Google or AppNexus or whoever, they can start to segment their audiences. So an airline for example can say, you know, you looked at flights from London to New York last week. Suddenly you’re on mobile device. You know, they can start to, you know, in the desktop world they can start to move, and track you as you move through the conversion funnel and understand how to spend money when it comes to social, paid search, display banners and so forth, but the minute the consumer maps across and moves onto their mobile device, they’re lost right?
4:27 The cookie just doesn’t translate across. So suddenly you’ve got a whole industry built on accountability, transparency, and so forth, and in mobile, advertisers have no clue who you are. So the biggest challenge, I think, for a lot of marketers is saying, how do I actually just understand who on earth I’m going to show my ads to? And I think in the past there’s been major challenges, particularly when you see, you know, a lot of adoption by gambling advertisers, finance advertisers, they want to make really sure that they’re targeting the right users in the right countries.
4:56 You know, all types of stuff. But one of the best, the other day, I saw, we were doing a campaign, we were troubleshooting we saw toys of RADS being served to Grindr, which is a gay social dating app. So you know, some would say the placement was good. Others may say otherwise. But is there a correlation there?
5:13 Yeah, who knows? Who knows? maybe the campaign performed well. It wasn’t one of ours, but you know, I think the key point that I’m trying to highlight is that, you know, mobile fil despite the incredible consumer adoption and the opportunity to reach consumers as they spend more time on mobile, it’s super tough for advertisers to actually understand where to target them to deliver the most relevant ads in a privacy-compliant way. So, you know, an Adbrain, that’s exactly what we focus on.
5:38 And you’re almost more of a big data company as well as just a mobile advertising company. I mean, they go, they go hand in hand these days. You know, the opportunity, mobile for me, is driven by data. Right? So firstly, you know, a bit about Adbrain.
5:49 We’re a real-time advertising platform. What does that mean? So, first of all, we build an identification and an attribution layer, so we can basically take a ton of data coming in when you open your phone. You’re playing Angry Birds for example, the publisher Rovio is selling that ad impression to an ad exchange. So we moved away from the traditional means of buying and selling ads by calling a guy up and saying, you know, give me a block of inventory.
6:12 So we moved into this whole concept of automation in digital advertising over the last kind of 5 years or so, where ads are bought and sold in real time based on data. The beauty in mobile is there so much more data coming in. So suddenly we may know, for example, if you’re sharing your location with the app you’re in, we can know your geolocation down to a pinpoint grid, on, you know, the block you are on, the street, for example. And how do you know that information?
6:36 Do we have to opt in? It has to be opt in. Yes, we are. We’re super careful about ensuring we only take data sets that are 100% privacy compliant. So the publisher, you would have had to opt in, and in the terms and conditions of the app you’re in, it says, you know, you can use your location data for whatever reason.
6:52 So the publisher is selling that. Right? You know, we’re just taking whatever data that is coming at our technology stack. So we take up to 100 data points coming through in real time and we run a bunch of probabilistic statistical algorithms to say, without a cookie, that we have a unique user. So we build a very rich audience profile from all of this data, so we can start to say, again, in a privacy-compliant way that we have a unique person.
7:15 Right? So that whole piece about tracking is solved. So suddenly we can deliver ads to a device, and we know if you then click and convert. You book a flight, you play a game, you download credits in the game, whatever. We know that’s resulted from an ad that we delivered through our platform.
7:30 Do phones hold cookies? I mean, they, well, we’re getting into the depths of it now. So I was just wondering how you might track me from my iMac to my iPhone. New York Times, for example, I might be signed up for a subscription. Is that email the same one as this email?
7:45 I’m just, I don’t even know. Sure. So listen, we, we look at it two ways. So first of all, marketers need tools for mobile, right? So once we’ve identified the user in mobile, we then have tools to make real-time advertising decisions, but the buyer is in control.
7:58 So they, you know, we’re a software-as-a-service platform. So big global agencies and brands license our technology. They do it all themselves, self-service So, you know, ultimately they’ve got an opportunity to lay over their own proprietary data. So again, let’s take British Airways as an example of a, of a hypothetical campaign. I’ll not, we’re in a private beta, so I won’t, I won’t disclose clients specifically at the moment, but an airline, for example, might have a whole ton of CRM data You know, you’re part of the Air Miles program.
8:27 They know every flight you’ve ever booked, every, you’ve gone on, household income demographic, and so forth. So they can, you know, if they can map that data back to our data sets and start to understand, you know, again, probabilistically, if that’s likely to be on you on a mobile device, it can massively transform the performance of the advertising campaign. So all of this is a big data challenge, right? It’s condensing you know, we could listen up to 100 billion ad impressions a month through our servers, right?
8:53 And more if we wanted to. So there’s only 1.5 billion smartphones in the world, so we see the same devices again and again and again, so it’s all about how do you leverage all of this data that you don’t get in online, so you don’t get the location, the environment, all the behavioral habits that you get on a smartphone or on a tablet, are pretty unique, so that’s what excites us. Talk to us about Adbrain. We always ask people to sit there, you know, what have you guys done, and what are you planning to do, and why do you think you’ll win in this space?
9:19 Sure. So listen we got a few founding principles, right? And one of the key ones is about transparency. That’s big on your website. You guys are very serious about that, big time.
9:28 So you know, we, you know, Adbrain was born out of frustration, right? So you mentioned, you know, I spent time at Google and DoubleClick, and so forth. You know, companies like Google and others built large enterprise software platforms that basically provide the tools for the buyers to do really cool stuff. AppNexus is another fantastic example, a company, you know, we really respect and admire, what they’ve done in the digital space. But you know, these tools don’t necessarily work, you know, the way you would need them to work in a mobile environment.
9:56 So, you know, coming out of this kind of world and having worked with some of the largest spenders in mobile, from the agency side and on the buy side, I realized there was a complete lack of credible tech. You know, it’s just, unfortunately, you know, and that’s not to be disparaging about the competitive set. I think it’s very much a factor of where we are as an industry. You know, it’s the adoption curve. It’s like going back, like I said, 12, 15 years in digital, and you have a lot of ad networks that sit in the middle and they buy ads low, they sell them high.
10:23 There’s a lot of money to be made, and it’s actually easier, often, for buyers at the earliest stage of the adoption curve, because they know they can call a guy up they can get their spend out the door, they can get some sort of a performance back. But Adbrain was built really out of a desire to go a lot further, knowing that all this data was sat there. And if we had the right tools, the right tech that we have in the digital world, and made it from the ground up from mobile, and really focused on the data leveraging angle, we could do some cool stuff.
10:52 So you know, I think frustration was more than anything the driver behind starting the business. So, you know, transparency for us is about saying, how do we give complete value to the buyer, right? You know, we’re not trying to arbitrage. We’re not trying to resell ads and do any of this funky stuff. We just want to build the coolest tech and put it in the hands of the smartest buyers.
11:12 And why do you think you guys are going to win, and is the space different from when you started? So it’s, it’s evolving, right? I mean, there’s a ton. There’s definitely a ton of competition, you know, and capital. I’m guessing advertising is a $500 billion-dollar global industry, right?
11:27 Digital is accounting roughly at % of that globally You know, mobile’s about 2%. Yeah, so 2 to 3%. So it’s growing pretty quickly. But when we went back to saying consumers are spending anywhere from 12 to 20%, and then if you look at the Mail Online, 50% of the time is coming from a mobile device, so there’s a major opportunity. So, ton of super smart guys are after, you know, after the kind of challenge, you know, I think for me, how do you defend yourself against that, first and foremost.
11:54 It’s talent, right? So you know, we’re a team now of 16. And we got another eight joining us this month. We’re growing pretty rapidly, which is awesome. Heavy bias on engineering, right?
12:06 So there’s a real hardcore business intelligence, artificial intelligence, big data set, which was tough actually to find the right team, but once we’ve got it, we’re just, you know, we’re flying. So I think, you know, for me first and foremost, it’s building a business that’s driven around technology, engineering, R&D, and then making sure that we’re working with some of the smartest buyers that you know We’ve got, hopefully, a pretty good idea of the kind of road map that we need to develop. But we’re working very closely with key partners, some of the biggest spenders in the world, for them to come in and say, listen, these are the types of features, this is the type of data we want to use.
12:40 So hopefully the marriage of a real commitment to tech, a commitment to building real value-adding technology products, really clear commercial model, some pretty unique IP. I like to think, under there, we’re excited about what we’ve developed. And the right partners hopefully will be the right mix, and of course, some great investors and backers that believe in what we’re doing and will help fund us as we start to grow. You said 16 people, you’re adding eight.
13:03 That buck and a half in the bank doesn’t go very far, does it? Sure, you must be thinking or needing some more money soon So yeah, I can’t say. I’m sure you were going to say, yeah, yeah, it was close to that. Yeah, yeah You guys know the story. The money goes quickly.
13:17 24 months is a lot. I mean, we, listen, we’re super, super frugal, right? I mean, you know, talk about lean. We make sure we are careful of every penny. But yeah, we’re raising more capital, so we’re going through the final throes of that in the moment, so hope something to announce soon.
13:34 Who’s behind the million and a half? So we got an awesome mix of angels Okay. So that’s a big angel round. Well, I was about to say, plus Notion Capital. So Notion they founded Star Internet, the first ISP in the UK, MessageLabs, which sold for over a billion dollars.
13:50 So these guys are hardcore. Enterprise SaaS VCs. They’ve been out and done it themselves. So great partners, and then we’ve got some fantastic adtech and mobile royalty angels come on board at the seed rounds. So cool.
14:04 Yeah and more money to come. More money to come. Okay. I cannot disclose. Fair enough, fair enough.
14:09 You know, this is Silicon Real, and we like to get real, and so we’d like to hit you with a few questions that are, maybe a bit more devil’s advocate. Do you have one, and wine, cuz otherwise I’m going to hit him with one. Yeah, I I guess so. For me, I’m not a huge techie. I don’t sort of understand completely the whole space.
14:25 I just maybe you, you look at what Google is trying to do with Google Now. Yeah, have you downloaded this new app? Awesome product, man. Really cool, amazing. So I played around with it over the last month or so, and that’s, I see that as a real opportunity for taking my online personality onto my mobile.
14:44 So maybe talk a little bit about how you guys differentiate from that, and how you anticipate either to work with someone like that, or to sort of you guys are completely different. And can one of you guys describe Google Now, cuz I don’t know what you’re talking about. Google Now, an app? Yeah, it’s an app on, I don’t know if it’s on Android. It’s on Android, right?
15:02 I’ve got it on here now, right? So you open up, let you have a little play. You, you literally, now it’s integrated so well with the OS that you just open up your, you open up your search bar and straight away it pulls my location. It says 42 minutes to home. It’s actually not bad.
15:19 So, and it pulls information from your Gmail account, so like, when I was, you allow it to take, yeah, so when I was in California, for example, over the holidays, it saw on the days I was flying, it saw my confirmations come through my email and it would give me live status updates on my flights, and so it did all that with AI. You didn’t have to tell it. I didn’t have to tell it anything, and so it tells you where you are, and cool things that are happening in your location.
15:43 So it’s very much that AI, that next evolution of where things are going, where the technology is telling you what to do, as opposed to you asking it. Right? Okay. All right, cool. Then I’ll go to you, Gareth.
15:54 Yeah. So, first of all, you know, you made a point around, you know, the tech side of things. You know, I think there’s a lot of complexity. I just say one thing. A lot of complexity about the tech, behind, you know, what we’ve built, but the reality is super simple.
16:06 There’s a beautiful UI where clients can basically deliver more relevant and meaningful ads to consumers. So, you know, that’s what we care about. The end product is hopefully a far more targeted ad that hits your device, you’re more likely to engage with, and the beauty is because it’s more targeted. The advertiser can buy fewer ads, so it’s not spray and pray, irrelevant stuff. An advertiser can actually make more, and deliver more engagement, more conversions, more sales, with fewer ads.
16:32 So that’s a cool thing and consumers. So your customers are ad agencies, not necessarily the business? Correct, adtech. You know, fundamentally, I mean, we work with a couple of direct clients. You know, big global social gaming guys that don’t really work with agencies.
16:46 They bring it all in-house, but yeah, we’d like to work with big large agency groups. Well, someday. Will it be like a Facebook ad or a YouTube ad, where people can do it individually? Or is this like 10 years down the road? We shall see, man.
16:56 We shall see. We shall see. Sorry, you were, so going back to, so it’s funny you know, what, Eric Schmidt was on Bloomberg West about a week ago, and he was asked his predictions crystal-ball gazing for 2014. He said three things. He said, first of all, mobile.
17:10 He said people have even begun to overhype the trend that is mobile. Right? That you know, despite the coverage in the press, you know, there’s a great book actually called The Fifth Wave that looks at how you know we’ve moved from multiple iterations of computing from the mainframe to the PC, and you know, all the way through to the desktop internet, and how mobile is just, you know, driving exponential growth, adoption, innovation. So you know, Eric, you know, I kind of trust what he says to a certain degree.
17:39 Smart guy. He’s done okay for himself. He’s done okay. He’s done okay. He needs to up his game a little this year, but still good, still good.
17:46 Absolutely. Maybe less political tours of the world, but who knows? I wouldn’t like to comment. So, so going back. Mobility.
17:53 And again, you know, the beauty for a company like Google, obviously, is, you know, they want to anticipate what you’re going to search for before you’ve even thought about it, and mobile has this unique opportunity to understand environment and location and behavior in a way that you just don’t have online. So that’s pretty cool. And the second was machine learning and big data and we’re seeing, you know, traditionally, the opportunity lies in working with advertisers, saying, hey, how do you buy an ad and deliver it.
18:19 But increasingly we look at large publishers, guys like Spotify or Pandora, mobile network operators that are sitting on a ton of data. People are sending fewer SMS. They’re using WhatsApp and Snapchat. They’re not making, you know, phone calls anymore, but they’re sitting on crazy data assets. You know, you’re looking at all these types of data players that are suddenly saying, hey, I can, you know, I can create value somewhere in this advertising mix.
18:42 I can help someone deliver a better ad to a consumer. So suddenly I think we’re seeing, you know, the concept of data and mobility is changing, and machine learning. If you can tie it all together, anyone with a data asset could do some pretty cool stuff in advertising, and hopefully, again, deliver better ads to consumers. So, you know, I think the big shift that I’m excited about is not just, you know, how do we put the tools in the hands of the buyers to deliver better ads, but how do we create whole new opportunities for guys that weren’t traditional advertisers to leverage their, you know, and activate their data in a way that can create value somehow?
19:16 So, empower them. Let them use the tools. Let them see the real-time feedback. Let them play with it, and then they’ll be sold. Absolutely.
19:22 But I didn’t answer your point on Google Now. So you know, I think the difference is, you know, unfortunately, we’re not in OS right? You know, our technology takes the data that’s out there, and it just does cool stuff with it. Google owns Android. It owns, soon, the hardware with Motorola.
19:36 It owns the service, so they know so much stuff, control the whole. Yeah, but you know, they’re certainly doing some pretty cool stuff around AI, and yeah, I’m a huge fan of Google Now. The first time I opened it, I was in Paris. It gave me the time back home. It gave me an English to French translation.
19:52 It gave me currency, recommended places nearby. I mean, you know, you don’t need to do anything. It tells you what to do. I feel so backward. I’m going to download it right when I, right when I get finished with this.
20:01 You know, speaking of Google, I mean, you came from there. Obviously they’re huge players in the space. You know the innovator’s dilemma comes up on the show all the time, with, like, fintech guys battling the banks. You know, you guys are going against your former employer, in a space that you would expect them to be all over, to own, to set up, you know, small independent startups within the company. You know, I know you’ve been asked this question before, but what do you say to that?
20:23 How do you compete with those big guys? Sure. I mean, you, I think it’s tough. I have nothing but, you know, tremendous respect for guys like, you know, I mentioned Google and AppNexus and others. There are big, you know, big players out there that are doing some pretty exciting stuff.
20:37 You know, fundamentally we are, you know, we are competing, right? We’re going after, you know, these guys understand the need to shift across to mobile pretty rapidly. You know, the big challenge, I think, for a lot of the incumbent desktop advertising tech players is that, you know, the other challenges, the dollars still aren’t there to a certain degree, right? So you know, there’s a major amount of growth still to be had in video. The average cost per thousand impressions, so that you know, the units through which an advertiser buys a block of ads in video is, you know, 10x plus higher than it is on mobile.
21:10 Right? So I think historically there’s been a major focus from the technology players, from the agencies, on cracking some of the challenges first around video before they get to mobile. So you know, how do we go up against it? We, you know, we build from the ground up. Right?
21:24 I think when you’ve got, you know, take Google out of the equation, any of desktop competitors have built pretty formidable tech on the back of the cookie. Right? Everything’s geared up for the cookie, so they got years of machine learning insights and data and they’ve got a whole tech stack and a data stack driven around desktop. Suddenly you’ve got like a mobile device spewing out all types of different data, right? And it’s, I think it’s quite tough.
21:47 You’re like a big ship with a small rudder trying to get over there. So you know, the reality is, as a startup, being maybe a little bit more nimble. You know, that’s always a benefit. We can layer focus on a major problem and build from the ground up. And I think we’ve seen, certainly, that a lot of the big desktop players are having to acquire in capabilities in mobile.
22:07 We’ve seen, you know, five, six major mobile adtech acquisitions last year. Twitter, for example, just acquired MoPub for $320 odd million dollars, in order to have capabilities in real-time mobile advertising. So, you know, I think we see time and time again that it’s often a lot easier for these guys to acquire an asset, not that that’s our goal. Right? We just want to create value and do cool stuff, but you know, hopefully we’ll be quicker.
22:33 But yeah, we’re watching, you know, you got an accent that gives away where you come from. But I was wondering if you actually took a step back a couple years ago before you started this company, and, like, you know, we’re an alien looking at the globe, would you, would you decide again to start this up in London, and if so, why? I love London, man. But from a business stand, yeah, no commercially, yeah, personally I love, I love London. Me too.
22:58 It’s a great city. I just feel the energy being back. I was away for a few weeks. Yeah, just being back, it’s like, w, just you didn’t feel that in LA or San Francisco even. It was pretty sleepy when I was there, because it was over the holidays, but yeah, San Francisco probably has it, but I just, so much going on here, so much energy.
23:16 I don’t care if it rains. Good answer. That’s, it’s m is 22 and snowy from where I’m from. So it says the man with a tan, though, you yeah, true. I’ll take, I’ll take 10 and rainy any day.
23:26 Yeah, that’s true. So yeah, why, why London? My rant, my little rant. So why London? I mean, listen, we’ve got one of the most advanced media businesses in the world right?
23:35 I mean, historically, the media industry in London is fantastic. Advertising, you know, Saatchi, Ogilvy, I mean, you know, the list goes on in traditional advertising. So just innovators in advertising. Yeah, absolutely. For the past 20, 30, 40 years, right?
23:48 100% so there’s a long, strong legacy of innovation around communications, media, advertising, which is pretty cool. You got access to capital. I think, you know, a lot of people bemoan the availability of venture capital in Europe, but we’re kind of seeing some pretty cool things happening there, and actually seeing quite a lot of available capital around. There’s unbelievable engineering talent. You know, we’re building a major engineering hub out of London.
24:12 We looked at all the options. I mean I started looking at a team in Tel Aviv. Looked all across Europe, and actually found just unbelievable talent brought three technical co-founders on board, and we’ve just been able to attract, you know, phenomenal engineering talent. I bring them from Europe, or you found them in London, in here? Are they from, are they from Europe?
24:34 One, so in terms of nationalities: Italian, Iranian and Sri Lankan. Cool. That’s London, right? They were already here, they were already here, part of an incubator called Entrepreneur First. Okay.
24:44 So my CTO had hand-selected a team, and they were working on some pretty crazy big data challenges. An ex-group, a friend of mine, was like, hey, you’ve got to check out these guys, and I went down. They were part of Entrepreneur First, which is a pretty awesome accelerator. So we need to get those guys in. I think yeah, okay, I didn’t know about them.
25:03 If you’re listening, yeah, they’re fantastic So, you know, that’s their whole mission, right? They were originally born out of a McKinsey project. We said, how do we you know, McKinsey were brought into the government to say, hey, you, a few years back, how do we drive organic innovation within the tech startup sector. And they did a whole project, and at the end of it they basically said, you’ve got to devolve power, right? And they went out and put together an accelerator program that brought some of the best talent out of British universities.
25:29 A pretty heavy bias. I mean, there’s a good split between you know, commercial and marketing, but really a heavy bias towards engineering. So my team came through the inaugural year, so all kind of PhD, you know, data science, artificial intelligence type guys that were working on some big problems, and I came along. You know, been in the industry for years, had the relationships, needed the right team and, you know, it was just the perfect fit. So is it easier to get talent here than in San Francisco or New York?
25:57 Do you think it’s cheaper? It’s cheaper, not significantly, but, you know, I think right now, right. So we’re in the process. You know, we’ve got an incredibly diverse team, and we’re sponsoring individuals from, you know, all over the world, from India, from China, from all over. And I think, despite, you know, the tirade in the press currently about immigration in the UK, you know, I think when you’re working on big IP-driven, you know, businesses like like Adbrain, it’s not so hard to make sure that you’ve got the right talent.
26:28 Obviously you’ve got to search for British talent. We’ve got some fantastic British developers, but, you know, London for me, as a global city, there’s such a pool of talent, and on the data, kind of AI side, these guys are less and less over at the banks. Well, they’re not attracted to the banks. They want to come to the startups. So us in the industry, what would you like to see change in London?
26:48 I mean, you said earlier you don’t think the complaint is valid there’s not enough funding. We heard that from a few other guys recently. As then you’re not looking hard enough, or you don’t. Maybe you don’t have the right business model. I don’t know what, maybe your business just sucks.
26:59 I think that’s a big thing too, right? It’s just like, hey, I don’t want to say it, right? You can say it. Why not? Sorry, dude, your back and punchier than I like it.
27:08 I like it. But so what would you like to see change about London? Would you like to see, you know, we talked about it before, that big exit, that big IPO? Would you like to see those things happen more so than any other things? There are awesome businesses here.
27:21 I mean, you know, King.com, Mind Candy, you know, a whole bunch of them. Wanga, you know, they’re a formidable business. Business, you know, building pretty cool tech assets out of London, so you know, I think we’re kind of already there as a city. You know, we need more development. I think in the angel scene, you know, there needs to be more money and expertise cycling around, but I think there’s just so much going on.
27:42 I think it’s just a question of time right. I mean, you know, we can’t be expected to leapfrog San Francisco, the Valley, immediately. You know, it takes time. But listen, the other reason I love London is you got some of the biggest brands in the world, some of the biggest izing agency groups. You know, it’s London and New York, right, are the two places for us to be.
28:03 So you know, what do we need to do in London? I think just you know, keep on and keep plugging away, and I’m sure there would be, you know, increasingly more and more young talent that are drawn, you know, not to go into the banks or to go into the consultancies, and, you know, already wanting to come into the startups, and, you know, they might not be founders from day one, but they’re starting to learn and new skills, and there’s a real cross-pollination of ideas. And I think because it’s such a liberal, open city, with so much immigration, I think we’re just a melting pot for opportunity.
28:33 So I’m bullish. I love it. Very bullish. Do you get phone calls from guys at Google that you left behind that are like, you know, Gareth, how’s the good life? And is there something that you’ve learned over the last few years about doing a startup that you would tell them, to give them some advice, whether to stay put or not.
28:50 Enjoy every meal you get, right? All that free food. You’ve got to go and buy your lunch. It’s a cold hard world about that. There really is no free lunch.
28:59 When you work for, no free lunch, you don’t work for Google Yeah. So on that topic, how, you know, you had some good, good career, right? In your 30s, maybe I’m I’m a young man. Yeah, yeah. And you, so how do you leave a really lucrative, nice career path?
29:14 Yep, to go start something else. I think a lot of people struggle with that. So how, how did you, yeah, how did you do it? It’s a good question. I mean, it’s an itch, right?
29:24 All my life I’ve been itching to, you know, to do stuff. So within Google I was always hunting down smaller teams where I could have bigger impact and drive more product innovation and get closer to the market and so forth. So, you know, for me, over a while it, you know, it became clear I needed to kind of be in that type of environment. I realize you know, the reason I left Google was purely because I didn’t feel we were going to solve the mobile problem immediately I felt it was such a major, you know, we’re going through such a transformational shift as an industry, and even at the consumer level, and there was going to be a ton of opportunity, but there weren’t a million and one places to go at the time, right?
29:59 The tech landscape was very immature, so I went to SoMo, which is one of the largest global independent mobile ad agencies, and they, just around the corner, they’re just growing in an unbelievable clip. I joined when there were 30 odd people. We opened two offices, on the West Coast, East Coast, Singapore. You know, some of the biggest global spenders in mobile going through these guys, and you know, sat there solving complex problems and building tech from the ground up, and, you know, being in an agency building out a pretty big engineering team was you know, a crazy thing to do.
30:28 So for me, I think it was frustration. Just, you know, had to go and solve some big problems. But I don’t know. I think it’s just the, you know, it’s the risk-reward mentality I felt I knew kind of what the path was like if I stayed in a corporate. As unbelievable as Google is, it’s quite a comfortable place to be.
30:45 You’re surrounded by amazing talent. You can be pushed like crazy, but I just felt that, you know, jumping out, plus, you know, I got an Israeli wife, and they, the Israeli culture is different. It’s like, you know, don’t be a schmu, go and do it yourself, and non-risk averse, or me just no fear of risk at all. Okay, just no. What do you think drives that?
31:06 We’ll get into Tel Aviv let’s talk about, let’s talk about, let’s talk about it, really quick now. On that same note, you just came back from Tel Aviv. You were there over the holidays. That’s right. Your m is from there.
31:16 That’s right. What’s that scene like? And if you talk about, explain what you just said. Yeah, listen, Israel as a country is awesome, right? Tel Aviv is an unbelievable place.
31:24 There’s a great book called Start-Up Nation by Dan Senor and Saul Singer. I think it is, and it asked the question. It says, how does a country of 7 million people, right, surrounded by neighbors that are pretty much hellbent on its destruction, multiple wars, and so forth, raining down over the last 60 years since they’ve been declared a state. You, how does a country in such a precarious situation, build more companies on the NASDAQ than I believe, I may be misquoting, so check out the book.
31:58 China, India, Europe, and somewhere else in Asia combined, right? Just crazy, the level of innovation, and a lot of it comes from agriculture. They’ve, you know, they found ways to irrigate deserts. You know, it’s the needs must, right? just tons of, obviously, you’ve got companies like Waze, you’ve got early companies like Amdocs, and many others where there’s been, you know, billion-dollar businesses built out of Israel, but a lot of it is down, arguably, to the Army.
32:23 There, everyone’s forced to go to the Army. You know, you do, if you’re a guy, you do three years military service, three full years, three full years. Women do two. So my wife did two years in the Army, right? And what happens if you’re particularly strong on, you know, science and maths and all the rest, you kind of get funneled through school, and suddenly you find yourself in one of the elite intelligence units.
32:44 So these guys, you know, what matters isn’t what university, what college you went to, it’s what unit you served at in the Army. So, small country, everyone knows each other. You learn to hack and do all types of crazy stuff on counter-intelligence, and these guys come out, and suddenly, you know, you’re in Tel Aviv, you’re on the beach, you’ve got Sequoia there, you’ve got Greylock, you’ve got Bessemer there. There’s tons of capital. They all have offices there, all have offices, right?
33:06 So the Israeli government made it incredibly easy for external capital to invest. Tons of smart guys, and just a culture where, you know, it’s a bit, it’s a scrappy culture, but everyone believes that they can do something there. There’s no fear of risk, you know, you’re constantly under threat, so go for it, live every day. There’s, you know, is it that simple, that they are under threat and you have to kind of seize the day? I, I don’t know.
33:29 That’s my interpretation, right? I don’t think you can ever boil it down, but it’s a, it’s a certain, it’s a country of immigrants, right? I mean, you had, you know, after the fall of the Soviet Union, you had, you know, close to two million Russian Jews came across to Israel, and guys with PhDs, you know, scientists and mathematicians and, you know, many others. Not they weren’t all PhDs, right, but a fair few smart guys came across. Many of them couldn’t find work, you know, they were, but they worked, you know, car park attendants and whatever, and, you know, their kids have grown up super smart guys, and, you know, they want to achieve something.
34:01 So, you know, you got a country of immigrants, you got a constant threat, a belief that anything is possible, and then you throw in a very non-hierarchical society and military, right? There’s very little hierarchy in the military, so there’s a whole culture of learning, debriefing, and whatever, so people don’t just get the technical skills in, you know, in the elite units, but they get the, you know, the concept of leadership at a very young age. So I think it fits well for going, starting a business, and your M said, just go for it, just go for it.
34:34 Is the tax incentives in Israel? I have no idea. Is it similar to here, kind of, or so? The Israeli, the Israeli government basically underwrote a large chunk of early-stage capital. So if you’re investing a couple of million, they would underwrite 50% of your deal.
34:49 So it was pretty interesting for a lot of the big funds to come across. Interesting, and you know, Google’s got a major engineering office in Tel Aviv, one up in Haifa. They’ve just built a big Google campus. You know, I was there the other day. I was seeing a guy who sold his business to the BBC.
35:07 He’s running a big social gaming company there. You know, we’re chatting over lunch, and he’s like, oh, there’s a company over there, they do toolbars, they have 500 million toolbar extensions downloaded, they’re sitting on a ton of data. You should chat to these guys. Pick up the phone, you know, they’re down there in the cafe. Suddenly you’re meeting another, you know, everyone works together, right?
35:24 In the same little bunch of streets, people drink in the same pub. So in the same way that you have a physical presence and kind of central location, in shortage, but I think even in London it’s a bit more str out, you know. It’s not just around Old Street, but in Tel Aviv it’s small everyone knows everyone. So that density and serendipitous moments, and that’s, that Simon Cook was saying that sort of, that’s where innovation comes from. And it’s, yeah, and it’s that physical population density.
35:50 You can’t do this on Facebook. You can’t do this virtually. It really needs to be, you know, three guys in a room talking rubbish, maybe some beers are involved. I don’t know. But that’s how a lot of these ideas start.
36:01 You know, it’s a bit, it’s kind of comforting to know there’s a bit old school there. Just to finish up with that, Brian, have you guys launched? Where are you guys headed in the next, like, year, two years, as far as your vision? Sure. So we’re almost 14 months into development now so major R&D project.
36:16 We, you know, our platform’s been live for a number of months, but we turned on our private beta back in November. So we, you know, just activating clients and working with some pretty guys so that is all underway at the moment, and we’re starting to ramp up quite quickly. So we’re building out all the necessary operational, business development, operations, support, and so forth. We’ve got some pretty cool plans for New York coming very soon indeed, so watch the space.
36:43 And really the plan, you know, it’s all about execution. I think 2013 was, you know, building tech, proving it, getting it out to market, getting it in the hands of smart buyers, and kind of getting that nod of approval. So now it’s just go, go, go. Awesome, man. I love it.
36:56 He’s very bullish on the future. I like that. I like that. You know, we always ask everyone that sits there a bit of an advice question. You might have known this is coming, but I’m going to hit you with it anyway.
37:05 If you can make a phone call to the 20-year-old Gareth Davies and give that young man a bit of advice, what would you tell him? listen more than you speak. Were you quite a talker? Yeah, no, it’s not that. Surround, you know, I think you know, the best advice I’ve ever had is to surround yourself by super smart guys that are a lot smarter than you and just ask a ton of questions, and soak up a lot of stuff, and bounce ideas off of people from all different walks of life, and whether it’s business or whatever.
37:35 Getting that kind of diversity of opinion, you know, you never know when you’re going to hear something from someone over here who’s a specialist, you know, in coffee, right, or in maths and big data, or in advertising, or in, you know, food delivery, or whatever. You know, it’s just bouncing good ideas around and learning from other people. I think it has the ability somehow, it penetrates, and I think it all mixes around, and suddenly good ideas come out of it.
38:02 So, listen, listen, listen, listen, just on that. So that comes up all the time, sort of surround yourself by smart people. In your perspective, what is a smart person? Well, you know, there’s a ton of forms of intelligence, right? I won’t give you the waffly answer yeah.
38:19 You mean how do you determine? Yeah, like, what is intelligence? What is a smart person? How do you is it someone who’s technically brilliant? Is it a great leader?
38:28 Is it someone who can be an incredible salesperson, or is it you, are you just, do you just know when you’re, when you’re around someone who’s smarter than you? Yeah, you know, I think there’s an energy of someone who’s got a particular level of specialty in their field, and they’re able to communicate it, right, and kind of get it out there. I think there are brilliant people out there, but if they’re unable to communicate their ideas, it’s really hard for them to, to kind of get that stuff across.
38:54 So you know, smart. There are, there are lots of, you know. Listen, the other, the other piece of advice I think I grew up, listen. I did a French degree at university, right, and now I work in tech and big data, and I never thought that I could ever do that, right? I never thought, see, Google Now didn’t know that, if they known that, they wouldn’t, any like to him.
39:12 So, so, so you’re saying you can change fields. You shouldn’t get hung up in what you studied? Yeah, I think if you’ve got enough intellectual curiosity, if people support you, you know, I read something who, I’m misquoting someone, the other day said, you go into a room, or a kindergarten full of kids, right, and you say, put your hand up who can sing. Everyone puts their hands up, right? Put your hand up who can dance, everyone puts up, because everyone can dance, right?
39:35 If you go into a room of adults, everyone’s shy, you know, because they, you know, you grow up and you lose your curiosity, your ability to learn. So you pigeon hole yourself incredibly quickly. So I think the British education system, when I’m looking, I lived in France for a while in France. It’s, you know, they kind of specialise you incredibly quickly, right? At least in Britain it’s a bit more open, but listen, not everyone is fantastic at everything, and nor should they spend their time trying to master, you know, music, arts, science, maths, the whole thing.
40:04 But I think it’s, I think it’s sensible not to pigeon hole yourself if you’ve got an interest and a desire and a bit of time. Nowadays, you, the access to information through you know, Google or Khan Academy or TED or whatever, you know, the information and data, which is information, is self-democratizing so I think we’re in a world where through the internet people can get access to cool stuff and learn and you know, don’t have to be pigeonholed. No, that’s good.
40:29 I think a lot of people just, yeah, they mentally stop themselves probably subconsciously and think, I can’t do that, I can’t do that, I can’t do that, especially when it comes to a career change or a startup, or, you know, if you have some background in X degree or Y degree, but we’ve met a lot of people here that have had completely non-technical degrees, you know, that are, that are right at the core of that game. But I agree, I think that’s good advice for this year. Find someone new in your life that that you want to aspire to be, or smarter than you, that’ll make you raise your own game, and get rid of one person in your life too.
40:58 I know you’ve got to, you’ve got to, you know, upgrade your peer group to zero-sum game is what you’re saying? I’m saying you’re looking like a true, a true traitor. Exactly. F, I’m saying you have a limited bandwidth of people you can really spend time with, so if you really want to up one side you do have to cut out some of the riff-raff. We had Tim Ferriss in here on London Real last year, and for his New Year’s resolutions, he’s not writing down things that he’s going to do new.
41:21 He’s writing down things he’s going to edit from his life. That’s people, routines, and things like that that he’s going to get rid of at his life. So anyways, that’s a different show. Final bit of that advice question. What’s the best bit of advice you’ve ever received that you can remember best?
41:35 Piece of advice I’ve ever received, I’ll go back to my wife. Just do it. There we go. Go and do it. Okay.
41:42 So yeah, believe. You know, what does that mean? It means believe in yourself. Take a, be, you know, don’t be afraid to take a risk. I think, what’s the worst that’s going to happen if you’ve got an idea, you think you can start a business, go for it.
41:52 What’s the worst that can happen? It’s perfect advice. From the missus, that way when you come home, you like that brownie points, if you’re watching darling. Exactly. And if you’re having a tough, you know, a tough financing around, you’re just like, you told me, you told me to go for it.
42:04 We’re living in a shoebox down by, can’t pay rent, we got no food on the table. No problem. You told me to just do it. Yeah, there we go. Hopefully she won’t regret it.
42:12 Colin, Colin, what did I miss, man? Did I miss anything? I think we’re good. We wanted to chat about Tel Aviv, and I think that’s really cool. That’s a perspective that I hear so much about, it or you know, I watch Bloomberg every morning and just these little things that keep, keep trickling over the last sort of year and a half.
42:29 And it’s cool. We should get a tel start if you’re listening and you’re a startup in Tel Aviv and you’re coming to London, the next 3 months, contact us, cuz I think it’d be nice to get to somebody who’s on the ground, maybe founded there, and just see what it’s like, cuz we talk about Berlin and the Silicon Alley and Valley, and I think there is, fly 180 lb, 120 lb on EasyJet, right? I mean, it’s the other side of Greece, you know. Maybe we’ve got to go on location there.
42:53 We go, and you were just there, and it was like 20, 20 degrees, and just, hey, it’s 20 degrees, breakfast by the beach. There you go. You both, you both got sun. I didn’t get any sun, so I’m going to definitely think about it. That’s awesome.
43:06 It’s a a really interesting story, Gareth. I think we all agree this is going to just move exponentially, this whole business, but also, like you said, it’s still early days. So you know, it’s, we’re still in 3G most of the places. I think for me, that’s why I don’t use my mobile more, is, because I hate getting back to emails on my mobile, and B, my battery life sucks, and C is just data, in terms of sort of how fast it can go. But, I mean, Wi-Fi is going to become your bous in no time, so go back to Tel Aviv to go on, but everywhere, it’s just ubiquitous Wi-Fi.
43:38 It’s just provided by the city, right? And Google’s doing a ton of things in the US, and I think as that opens up, then it makes life easier. But what about tablets? You want a, you want an Android or iPad? I have an iPad, but I never use it.
43:51 That’s my next question, cuz that is a mobile device, technically, right? And everything’s going that way. Yeah, so everything is going to be your market, right? Yeah, absolutely. I do.
43:59 I think if speech recognition improves and battery life improves, I will really use TBL. You use voice? Are you on an Android device, cuz you got Google Now, right? Yeah, I’ll have it on my iPhone, and it’s pretty good. Yeah, because getting, I just typing, I can get, I can just type really quickly, and so it’s more, way more efficient than, do you know what I mean?
44:20 For search, I think it’s awesome. But just last question, your thoughts on Google Glass? I’m sure you know you’re not working to market that with the current company. Maybe you are, but you know, you used to work there, and, and what are your thoughts? Is there advertising there, or is that in 5 years?
44:32 Ah, there’s no doubt about it. Right now they, there’s no advertising capabilities, right? So they blocked, as they’ve rolled out the SDK for developers. You can’t basically deliver ads into the glass platform, right? so they’ve done that on purpose, logically.
44:49 For me, I mean, you know, we’ve only got to look at, you know, there’s projected to be, if you look at Cisco, Cisco project 50 billion connected devices by 2020, Gartner in December, so a lot fresher stats say 26 billion. So who knows how you count it, right? But certainly CES, which kicked off this week in Vegas, you know, Samsung’s releasing whole integrated home entertainment systems, where you can now text or message your fridge, your boiler, right?
45:16 So if you’re away, you want to change the thermostat, and you want to you know, save power or whatever. You know, the whole, this exponential growth of connected devices, forget about all the data that’s available there. There’s tons of opportunity. So for me, wearable tech is super cool. Glasses are particularly cool.
45:35 I don’t think we’re going to see ads immediately, but at the same time there’s a ton of opportunity, because it is mobility. It’s just a hands-free mobile device, that’s all it is. You certainly get the eyeball time. So, no pun intended, and I guess for you, the more data available, the better you can analyze it and give it to your customers, so they can target it better to the customer. Absolutely.
45:56 So your happy days. Absolutely, and hopefully it means better ads for everyone right? As a consumer, more likely to get something that’s relevant, which is hopefully a good thing. Yeah, that’s really what you want. I mean, that’s what everyone wants, really.
46:07 I don’t mind irrelevant ads. Yeah. Have you tried the Google Glass? I haven’t. Me neither.
46:11 You, I don’t have the contacts anymore. I’ve been shut out of that world. You’ve been blacklisted. Awesome. If you’re listening and watching us live, thanks for bearing through those first few minutes.
46:21 You probably have found some personal things about, you know, us. On that, if you want to watch us and you’re listening on iTunes or on YouTube, channel Silicon Real, where you get the full-on single camera, single person look, and that’s new. It’s good it’s going well. I think, yeah, yeah, that’s going well. Episode 20, 28, I think.
46:39 Yeah, we got picked up on our third season now on YouTube. We’re really excited about that, and we’re on Twitter @SiliconReal, on Facebook we are always looking for people to help out, specifically for a BISD person. Come get involved. You can meet cool people like G every week. New Year industry, yeah, make us your plus one.
46:59 Make us, you upgrading your peer group there. Go, you can hang out with super smart people like Colin and me. I don’t know, and learn a bunch of crazy things. You guys are my plus ones. That’s why you’re the smarter people than me.
47:11 It’s a synergy, right? so that’s all good. How do people get a hold of you? You on Twitter? I’m on Twitter, Gareth Davies, RM Adbrain Tech is the best one.
47:20 So follow us, check out what we’re doing. We’d love to hear from you. So thank you for listening. It’s a fantas F story. I love the fact that you were from Google Now doing this stuff.
47:29 We wish you all the success. You know, we say it’s about the people on Silicon Real, and it is. So thanks guys so much. We’ll see you next week. Thank you very much.
47:38 Thanks, man. Guys, take care. Like, these are interesting, awesome people that, like, you feel comfortable having in your house and that you want to spend more time with, and that way the service becomes addicting, where you just want to use it over and over and over again so, because we put so much time and effort into picking who we want to be part of our organization, it really reflects well when the clients use the service. Okay, fair enough. Well, this is Silicon Real, so it’s time to get real.
48:02 So Lauren, we’re going to hit you with a couple hard questions. I’m going to go first. You guys charge 20% of the total taxk. Someone say that’s a lot of money.
