Anzu.io: A Startup That Brings Real-World Ads To In-Game Experience – with Itamar Benedy [Ep#18]
Do you think games and businesses are part of two separate worlds? Do you consider every ad boring and invasive? It’s time to update your brain with the story of Anzu. In our 18th episode, you’ll know the story of Anzu.io, a startup that connects game studios to advertisers, by providing them a platform to include real-world ads in any game object. But, how did Anzu’s founders go from an idea to the traction stage? What kind of challenges did they face in the way? How did they overcome it? Our guest, Itamar Benedy, co-founder of Anzu, answers these and other questions in the 18th episode. Let’s go! SHOW NOTES MERGING WORLDS What is the problem that Anzu is solving? And what is the solution it is offering? When we looked at the game developers, we saw a big problem: helping them to build the business model of advertising, without harming the user experience—all the pop-ups in the annoying ads we felt weren’t a good solution. On the other side, were advertisers and brand. We saw that there were some audiences very hard to reach—many of the younger audiences, for example, don’t watch a lot of TV anymore. And then, we saw gaming as a very good channel to reach these ‘unreachable’ audience. So, we tried to solve problems for both types of companies, by basically connecting them in our platform. How our tech works is we integrate with game developers—mobile, PC, Xbox, PlayStation—really any type of applications. Our technology allows the game developer to convert every object of the game into ad placements. So, every billboard, logo, object of the game can be actual ads. And the beauty here is that this is exactly how we as end-users consume content in the real world. So, we thought, why not to bring these real-world ads into the gaming world and the e-sports world and enjoy all the advantages of digital advertising—programmatic media buying, targeting personalization, real-time data? A LOWER BARRIER What features you’ve chosen to have in the beta version? Our vision was always to focus on the biggest games in the world—the triple-A games that never showed ads. And now, for the first time, they’re accepting advertisement, because of our non-intrusive, native, very authentic ads. But we knew that these game developers were very, very picky in the sense of what tech they would allow and would accept. Number one, we started with mobile developers—which barrier to entry is lower—with a more basic version, just to support mobile. As we grew, we moved into having a mature platform to use with the very big game developers. Number two, in the advertising world, if you can’t measure it, it doesn’t exist. We were the only company in the world to provide ads viewability and real-time data around the ad formats in our gaming environment. Now, marketers can also understand, for how many seconds did the user see the ad, what’s the percentage of the ad from the whole screen, how much of the ad is actually being seen. So, working in a parallel on the measurement tool and on the ad tech stock, and starting for mobile then going to the triple-A, to the bigger games, is basically how we structured it. Of course, there is a minute—like hundreds of different features that we had in mind. And we tried to prioritize. Entrepreneurs think that they know what feature is most important for their products. But the reality is that the clients, the guys who actually pay for it and use it, they are the real kings. So, really listen to the market and develop whatever you have a very clear understanding that clients are going to use. So, really listen to the market and develop whatever you have a very clear understanding that clients are going to use. SALES CYCLE And with a beta version, were you able to start convincing this triple-A Game Studios? With the triple-A games, the sales cycle obviously is much longer. From the day they tell you that they want it until the “go-live”, there’s a big period. With the mobile developers, it’s quite the opposite. It’s a very fast integration sales process. With the triple-A games, first they need to accept the concept of what you’re doing. Then, there are two things happening in parallel. Number one, they will audit and test your platform to see if that’s something that is good enough for their standards. On the other side, you’ll get a list of features: “Okay, now that we like what you do and we tested everything, in order to go live, here is a list of 10 features that you need to build for us.” But then it’s easy to build them, because we know that there is immediate use of those features. THREE GOOD ARGUMENTS Was it challenging to convince advertisers that you could, in fact, engage users in this different virtual environment? First, if I’m looking on advertising and programmatic buying, there are a lot of problems in the attic world and, in some senses, it is broken. So today, if I’m buying traffic in a programmatic way, there’s a lot of fraud. As a company who integrates into the game engines directly and work with console environments, we can provide a much cleaner environment. It’s like a third-party audit company. That’s already a big plus for the advertisers to work with us. Number two, it’s around brand safety. Today, in the social world, there is basically user-generated content, so you cannot control the content that has been seen. Ads and brands can appear close to things that are not brand-safe. With gaming, as a nonuser-generated content platform, we can provide a very clean and brand-safe environment in that sense. The third point is around eligibility. Today, marketers are buying a lot of traffic that is not fully being seen. With our patents and partners—the cyber security companies—we can give confidence for our marketers to only pay for viewable ads, and ads that are actually being seen, for enough time, for big enough of an ad… SEED FUNDS Let’s talk about funding… How has the seed fund helped you in the very beginning? Each different funding stage has different challenges, different opportunities, pros and cons. In the very, very beginning, when you go to raise money without a working product, you’re looking for investors to believe in the team, to believe in the initial concept. We raised with a PowerPoint, the first fund. It was a smaller amount, so the risk was smaller for the investors. You’re looking more for investors who have good intuition about you, about the product and about the market. And investors know that the product can change, the market can change, but if there’re strong entrepreneurs behind it, they will find a way to make it happen—to pivot, to do whatever needed to be super successful in the venture—and to give a very high return on investment for the investors. In the very, very beginning, when you go to raise money without a working product, you’re looking for investors to believe in the team, to believe in the initial concept. THE TRIANGLE Did you have any kind of prototype or mock-ups to show investors? The first fund was basically only raised with a PowerPoint. We tried to focus on the triangle… Number one: a very strong founder team that knows how to get shit done, how to execute without a lot of resources and to be very effective in that sense. Number two: to focus on a market that is so big, that it can be so meaningful to build and to innovate in that area. Number three: to focus on the product, the idea, the concept and the amount of thought that was already invested in that. Eventually, that played for us pretty well. That funding helped us to hire a small team, build the first prototype and get the first client. So, to the second fund there was already a working product. MARKETING EFFORTS Direct sales are your main marketing efforts? The team is pretty small. We’re doing most of the things in-house and a lot of organic stuff. We have good connections and a good network in the ecosystem. We’re going to a lot of events, we’re meeting a lot of people, and we have a lot of ambassadors and champions who really believe in what we do. Because this is such an interesting topic, it’s very easy to associate with, and we see a lot of traction on social media. Today, gaming has become a pop culture; the big games are brands by themselves. There are a lot of examples. There is a guy called DJ Marshmallo, he’s doing like musician concerts, inside games. People will go into the game, not only to play the game but to hear his show. Gaming is becoming basically the new social media. Gaming is becoming basically the new social media. SEE, THEN BELIEVE What was the most challenging thing in the way so far? There were a lot of challenges down the road. In the very early days, a lot of people were very pessimistic about what we do. We heard a lot of people who didn’t believe in that. As we grow, as we continue, as we validate our solution in the market, more and more people believe. Now, most of the people will agree that this is going to become a big business—of course, with the big companies who just backed us recently. Just believe in yourself and don’t listen to any feedback coming from people who know very little about what you do. The second most challenging thing is still to build the best tech in the world and please all of the players that we’re working with. Just believe in yourself and don’t listen to any feedback coming from people who know very little about what you do. FINAL ADVICE A piece of advice for startup entrepreneurs that are listening to us… I’ve always looked on the triangle of: the idea, the team and the funding. A lot of entrepreneurs think that it’s always hard to get the funding or always hard to get the idea. I can tell you: bringing the best team is always the most challenging thing. If you have a very strong team and if you’re focused enough, eventually you’ll find a good idea. And once you have a good team and a good idea, eventually you’ll get funding. A lot of entrepreneurs think that it’s always hard to get the funding or always hard to get the idea. I can tell you: bringing the best team is always the most challenging thing. So just focus and having a strong team and be laser-focused on what really matters, and everything will basically come from that. MORE ABOUT THE FOUNDERS Itamar Benedy (LinkedIn) – Co-Founder & CEO CEO of Glispa, a Berlin-based advertising firm with €100M in annual revenues, a team of 250 people, and 9 international offices. Itamar has been overseeing the Glispa’s transformation from an affiliate marketing company into a full-stuck ad-tech business. As part of this journey, Itamar led the acquisitions of JustAd, a playable ads start-up, and Relevantech, a Telecom monetization platform. Previously, Itamar served as VP Marketing at Sport.com and Yoga.com, leading the user acquisition, monetization, and analytics teams. He guided Sport.com to become a market-leading fitness firm and transformed mHealth into a business with over 40 million downloads across 30 apps. With a decade of experience in mobile and marketing, Itamar is a member of the Mobile Steering Group Board of IAB, and the Young President Organization (YPO). He was also nominated for Forbes Israel 30 under 30 in 2016. Ben Fenster (LinkedIn), Co-Founder & CPO Anzu.io Before Anzu, Ben was the Chief Product and General Manager of Pay.com, an e-wallet subsidiary of Safecharge. Ben was in charge of building the card-issuing business of Safecharge saving millions of dollars annually in Mastercard/Visa scheme fees. Prior to that, he served as VP Technology at Safecharge, a public company valued at £350M. In this role, he led the integration between the Playtech software casino and the Safecharge online payment solution to maximize profits and reduce operational costs for both parties. Before that, Ben was appointed as CTO of Social Gaming at Playtech PLC, a public company valued at £1.5B. He built from scratch a social casino game studio that achieved more than 5M MAU, and generated over $80K a day. At the age of 23 Ben sold his first company SoWise to the Israeli billionaire Mr. Teddy Sagi and has over a decade of R&D and product management experience. Michael Badichi (LinkedIn), Co-Founder & CTO Anzu.io Before Anzu, Michael led the Innovation Lab at IronSource, an ad monetization platform with $1B valuation. In this role, he managed all aspects of architecture, infrastructure, and hardcore development and also built from scratch some large-scale monetization systems the macOS Installer. Prior to that, Michael founded the JumiTech company, a platform for developing local and remote apps and services that released over 20 high-quality apps in the automation, remote control and real-time camera streaming fields and reached over 20M users.Previously, Michael was the leading architect and developer at Zoran. He worked with a range of technologies involving Smart multimedia mobile-phones when developing the award winning Approach line of processors, and was part of ARM development effort for the Mali 3D GPU.Michael has been developing disruptive technologies for more than 30 years. As a true professional in any aspect of software engineering, he was a mentor at the Tel Aviv Barclays techstars accelerator. MORE ABOUT ANZU ANZU.IO (Website; LinkedIn; Facebook; Twitter) – is an in-game advertising platform that brings the sophistication of advertising into video gaming and esports. Our Blended In-Game Advertising solution seamlessly integrates non-intrusive ads into the gameplay. With Anzu’s state-of-the-art programmatic technology and real-time data, brand advertisers can deploy real-world ads in IAB-recognized formats through exclusive inventory of top video games that promise brand safety and ad viewability. We work with top names in gaming and esports offering new revenue streams to game producers with our cross-platform advertising and monetization solutions. With Anzu, gaming studios have limitless advertising opportunities without interrupting the gameplay that gives them full control over content, ad formats, and analytics. Backed by BITKRAFT Esports Ventures, WPP, and Axel Springer Digital Ventures, Anzu strives to transform gaming and esports into a premium revenue engine, promising a native advertising and monetization programmatic solution the video gaming industry has long waited for. Founded: 2017Offices: Israel, GermanyTeam Members: 18Funding: $8M (Seed Round+Round A) The post Anzu.io: A Startup That Brings Real-World Ads To In-Game Experience – with Itamar Benedy [Ep#18] appeared first on The Traction Stage.