Matthew: Hi, this is Matthew Wise with FounderLY. We empower entrepreneurs to have voice and share their story with the world. Enabling others to learn about building products and starting companies. So it’s with great excitement today that I’m with Anne Bezancon who is the founder of PlaceCast. PlaceCast is a location based mobile marketing platform. With that said, Anne, we’d love for you to give our audience a brief bio.
Anne: I’m French and I started with online related activities about 25 years ago in France with the Minitel system which was a bit of the grandfather of the web conceptually. And since then I’ve been working in that field, starting a number of companies, the latest of which is PlaceCast which I started in 2005.
Matthew: What makes PlaceCast unique? Who is it for and why are you so passionate about it?
Anne: So the fundamental problem that we went after is the future of computing is mobile. And advertising is pervasive. And how do you make advertising less annoying and more pertinent and relevant on the phone, because the phone is going to be the device that you’re going to be interacting the most with. So it dawned on us that location was really what was differentiating the mobile use case from the web. And we started thinking how can we make marketers talk to their consumers in a way that’s much more relevant and frictionless. And one of the things that was obvious was we need to be able to understand context and place and time, and if we can do that and associate the marketers message and the consumer who actually wants that message and all our programs are opt in, then we’re going to resolve a problem where it’s going to really be a win-win.
Matthew: What are some of the technology and marketing trends that currently exist and where do you see things developing in the future for your space?
Anne: So location is relatively new. We’ve been talking about it a lot but the technical capabilities have not really been there until fairly recently to do these at scale. And still today there is a confusion about what type of location these services can be provided. Most of what you see out there on the consumer side is based on applications which requires a smart phone. And we live in Silicon Valley we don’t realize that 35% of Americans, only 35% of Americans today have a smartphone. And it’s less in most other countries in the world. So from that population you need to get people to download an application. You need people to be in a what we call a pull scenario where they’re going to do a search or usually they have to open the app in case to get something to happen. And our approach was we would like something that is much more generic then that that works with all phones.
And on the advertisers side they want reach, what’s called reach. So they want to talk to everybody. They don’t want to talk to the 500,000 people who are using Four square. So there was a challenge there, how do you do that and how do you work with the telecom operators to be able to use location that they have, that they’re not usually exploiting today in the most meaningful fashion. So to your question about where this is going i think we’re at the very beginning of a major revolution. I believe that personalization is going to be the next wave. And again today Facebook announces new ways of gathering more detail about their users to be able to personalize advertising even more. This is the big next trend.
Matthew: We’ve covered your background and an overview of your market. We’d love to dig into the details of your story. How did you come up with the idea for PlaceCast? Was there an epiphany moment or was it a series of events that led you to discover it?
Anne: So I’ve been you know, swimming in the online universe for a long time and I’ve always been passionate with maps and spatial representations of the world. My father is an architect so I think I was at an early age already sensitized to the organization of space. And as I saw the business evolve the previous company I was working with was dealing with Wi-Fi and there was an obvious correlation between being connected to a hot spot and knowing where that user was because you wouldn’t know which hot spot they were connecting to. So that idea of taking location into consideration starting to germinate there, and thinking of the future of computing becoming more and more mobile. This was before the iPhone came out, so it was real interesting for us to see 2007 happen. This is when we got our first round of funding, actually. And to see that the ideas that we had were starting to materialize.
Matthew: Who are your co-founders, how did you meet and what qualities were you looking for and how did you know they would be a good fit?
Anne: So I was very lucky in the fact that I co-founded the company with Daniel Parks who is an Australian engineer, and he had worked for me in a previous startup, a company I started. So he had landed by some miracle of friendships of circumstances and was fairly young and extremely talented guy and ten years later when I decided to get into this enterprise I called him up and I said, I have this idea, what do you think? And I need you to build it. I can see it and I can define what the product should do, but I need your brains and we have a very symbiotic intellectual relationship. So it has helped us very quickly come up with the right design for the platform. And it’s remarkable I think in all the technology companies around here that we have not really changed any of the original design of the product or the platform in six years. We got it right the first time. And that’s allowed us to scale into the level of the business that we’ve developed up until now and hopefully a lot more.
Matthew: From idea to product launch how long did it take and when did you actually launch the product?
Anne: So the idea was to have a functional version of the product in a matter of months and to be able to generate revenue before we would fund raise. So it took us probably from starting the company in August ’05 with a white board in my living room, to a functional beta probably four months. Just very basic things functioning and then it’s been since then the huge production of proprietary IP with several patents, some already granted. It’s actually a pretty complicated problem to manage location and time at the same time you want to manage user information and what the advertiser wants to publish. So you have to manipulate all sorts of dimensions in real time and that’s turned out to be quite a technical complex problem to solve.
Matthew: Are there any metrics or social proof about PlaceCast that you’d like to share with the audience?
Anne: Well one simple one which is that we have about 10 million active users today just in the UK for example, which our numbers I can disclose. We are working with Telefonica UK there. We are working with AT&T in the US. I don’t need to talk about the scale over AT&T. We are active I think in six countries today and just deploying in probably as many as that in the next six months.
So, I can’t really disclose a lot of numbers. I can talk a little bit about the performance that we have with our marketers which of course dependent of having a large audience is being successful and matching that audience with what the marketers are trying to do. And we see with all our problems, which again as a user you opt in to a program. You don’t have to do anything further. And whenever you are in the geofence, which is a virtual perimeter around a store for example for the brand that you are distributing the program of. You’re going to receive a message that is about probably a promotion for a product of that brand.
But it’s going to be relevant to you because it’s going to be in proximity to a store, it’s going to be at the right time for your intent to be, you know, tapped, and you don’t have the same intent when you are hungry at noon then if you’re looking for some electronics on the weekend. So there’s a whole know how as to how you deploy this program and strategy that will deploy with our brand partners. But the results are extraordinarily better than any other marketing techniques that have been used so far. So the worst return we get on messages we send is, I think, 12% conversion to purchase of the store. And the best are like above 50%.
Matthew: Wow, that’s amazing.
Anne: So it’s really extraordinarily better investment then any other you know direct marketing or action oriented marketing techniques out there.
Matthew: We now founders face new challenges when they decide to launch a company. What was the hardest part about launching PlaceCast and how did you overcome this obstacle?
Anne: That’s an interesting question. You know you start and you don’t know what you don’t know so you just go at it with a lot of passion. We didn’t feel that there were that many obstacles that we couldn’t figure out and surmount. I think for us as far as the growth of the company the financial collapse of 2008 and the drying out of all the advertising budgets for six or nine months after that was really a hard blow to progress. Because if you can’t scale as quickly, you’ve hired people and promised some revenue and suddenly there is no more money, you need to scale back or at least slow the growth. So for us there was this moment of, we know we are right and we know the market is going to be there at some point, and we have to figure out how to bid our time and figure out how to make money in the meantime.
Matthew: Since you’ve been in operation what have you learned about your business and your users that you didn’t realize before you launched?
Anne: We learn every day. Every program is different. You know it’s human behavior. So on the one hand it’s logical that if you have a better offer you’re going to respond more. Respond more, more people are going to take advantage of it. But on the other hand, what’s real interesting is the granularity and the sophistication. Each of, you know we work with an office for example. It’s a very different proposition for a brand that sells rather high end sports equipment then it is for Sonic, with whom we work as well, which is a hamburger chain. Or in the Royale or Starbucks with whom we work as well, KMart.
So all of these brands have different marketing strategies, different types of audiences they want to reach. And what’s interesting is how do you apply this location based geofencing method to their problem. And the result is vastly different from one customer to another.