Maximizing the Moment | Brian Handrigan from Advocado

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Alexander Ferguson 0:00
Three people meet for lunch and discover they each possess a unique ingredient for a new company. The result becomes Avvocato, a company that connects traditional advertising with the digital world to maximize click through rates and ROI. In this episode of UpTech Report, I speak with Brian Handrigan, Advocado’s, co founder and CEO, who explains the unique technology they use to find the synergy between television and the internet, and discusses an unconventional hiring approach they use to eliminate unconscious bias and diversifying their team. Thanks so much for joining me, Brian. I’m excited to learn more about Avvocato how we got started, and also how you are innovating and continuing to grow and look forward to the future. So first off, Brian, where are you located? And what year did you start this company?

Brian Handrigan 0:47
Sure. So Advocado is located in the central part of the states. We’re in St. Louis, Missouri. And this is actually a project that my co founder and I started working on a couple of years ago. Actually, this is a really fun time for us because it was Thanksgiving of 2017 when we got the phone call that we had someone willing to to let us try out our minimum viable product. So we have a lot to be thankful for this way.

Alexander Ferguson 1:14
Indeed. So two years later, this this continuation of the journey. Tell me kind of how did it start off? And what was the primary focus of the pain point you’re looking to solve? And how has that evolved? As you’ve found more product market fit?

Brian Handrigan 1:27
Gotcha. So So one of the things that’s really important to think about when it comes to our journey, is really my co founder, Jeff Lenihan and I are called the normal say, Startup Weekend, right? co founders, we’ve been business partners for about 10 years, we used to own a digital marketing agency together, which was my background, I’ve spent over 20 years in that space. So So what’s important about that is it was the experience that we had through that journey that really saw an opportunity that helped us identify that opportunity. So for example, for those that don’t know, right on the digital marketing side of things, what we experienced for years with our advertisers where it was that when they were running television, our campaigns did better. Right? It was great to be on the on the receiving end of that benefit. But the TV folks didn’t like it so much, right? Because what’s happened if you if you’ve been following any of the trends in media, over the last 10 years, digital has been growing, traditional advertising has been declining. And in 2017, there was an inversion, where digital finally surpassed traditional advertising. So So you know, that part of things is one big part of the influence. And what kind of happen was a couple of years ago, about two and a half years ago, probably a mutual friend of Jeff and I’s asked us to have lunch with a friend of his. And it was one of those kind of coincidental right interactions. And the reason we were asked was because we had digital marketing experience. And we also had prior SAS startup experience. So this isn’t our first startup. And so we were in a phase where we had left that startup, it was doing great, we brought in an outside CEO. And we were ready to start building again. And so we go to this lunch. And you know, to again, put it in perspective, we in digital marketing, you’re always looking for an edge. And so we had written algorithms that would talk to the Google ad system to try to write price keywords. And so while we were at lunch, we got introduced to Sam was one of our co founders now. And his family owned this really interesting intellectual property. And it was this what was great, right? If you think about trying to introduce something new, it was already an industry standard for ad verification. So large advertisers like Coca Cola, would we would use it to make sure that when they bought ads all over the country that they actually got what they were paying for kind of a crazy idea. And so as we were sitting down and talking, talking at lunch, you know, Jeff and I looked at each other, we said, Wait a minute. So there’s a system that’s already in place that advertisers already trust, that tell us exactly when a specific ad is running anywhere in the country. Okay, that’s pretty cool. And now taking you back, right, we already knew and had experience knowing that television could influence digital. We said, How much better could it be if we knew exactly when that TV ad was running? What that TV ad was, and we went ahead and we went and connected, but initially, it was to Google. And we essentially asked Google to tell us what we needed to bid to be first, for all of the keywords our customers cared about. So it was a combination of experience, and a hell of a lot of luck to be at that lunch that day and realize we could control a really interesting set of intellectual property.

Alexander Ferguson 4:52
A lot of good things happen over a lunch they’re being able to it’s the meaning of of both unique technology as well. Your experience, the algorithm and the opportunity in the market brought together this. Avocado No. Curious the name. How’d you guys arrive at that?

Brian Handrigan 5:08
Yeah, so um, it actually came from a time we were all sitting around trying to name but the essence of it is this right? Advertisers are trying to connect with, with viewers or consumers all the time. Right? And we are constantly distracted, right? We’re constantly on our on our mobile phones. And the way we look at it is there’s a small window of time when a specific consumer is actually right and ready to hear what an advertiser has to say. Yeah, like me and you like avocado toast, you know that there’s only a small window of time. That is so true when an avocado perfectly right. So while while we were sitting, right, it was actually Sam that said, we’re kinda like avocados. And so it then evolved into avocado.

Alexander Ferguson 5:53
Love. So then being it starting in 2007, that kind of first class uh, yeah, I’ll try this out advertised from there. Were you guys been bootstrapped with your own funding? Did you get VC funding out of that, sir? So

Brian Handrigan 6:05
back then we were bootstrapping, right when we were doing our minimum viable product, and trying to really understand it. You know, that was all Bootstrap. Actually, what was what it was was Jeff and I had some intellectual property that we were contributing, there was a watermark they were contributing, and then we kind of self funded that first test. After that, we said, Okay, we actually think we have something, right. And this is actually kind of a, it’s called a really good note for entrepreneurs out there. When you do your minimum viable product, and you’re trying to test it, what are your benchmarks you’re trying to get to right? So for us, we were looking at trying to prove that we were finding more interested consumers. And our metric was click through rate on a Google ads campaign. And our target was if we could achieve a 30%, or greater improvement on click through rates for a reasonable average cost per click increase, then we had something we are targeting 30% improvement at a 10% average cost increase, we blew that away, we ended up almost doubling the click through rates are the 98%. So back then we said, Okay, we have it, let’s build it. The other thing, though, is to make sure we didn’t launch too fast. So we did go, we went to some investors and raised some initial Angel, right, precede capital, and said, Okay, what we want to do is we want to build a platform that is complete, reasonably complete on day one, we didn’t want to baby step into it, because the ad tech space hats, you know, can have some bad rap in terms of smoke and mirrors and not really creating value.

Alexander Ferguson 7:38
If you want to make rd go into the marketplace, setting the right tone, it got exactly already turned key, and in a way. Got it. Yeah, we needed a fully baked product.

Brian Handrigan 7:47
Yep. And our first version of the product was pretty much what we did, in our minimum viable product. It was using signal data, as we call it right from broadcast television ads. And I’ll explain how everything works here in a sec. Right. And then we were activating what are referred to as micro moments. So literally two minute moments of time, in terms of enhancing Google search campaigns.

Alexander Ferguson 8:10
And did you manually do that this first test, or was it all automated, so we fully automated

Brian Handrigan 8:15
that test, it was a lot of duct tape, baling wire and bubble gum. But the first one truly worked the way we want it. And one of the critical aspects of it was that it had to be automated, because we never knew when a TV ad was right. And if we were going to use, say, the old method of getting a schedule file that told us which 15 minute block, a TV ad was right, we weren’t going to have any any true impact. Got it. We were just doing something everybody else was doing. So we actually fully automated it. And so I’ll lay out kind of here’s how we work, right with that watermark. Within the first couple of seconds of a TV ever running. We have computers all over the country watching TV. So we’re not listening in your home right now. We’re listening in a central station and that’s

Alexander Ferguson 8:57
specific computer all over the place watching for this and watching

Brian Handrigan 9:03
local TV and national TV all over the country. And what’s what’s different than content recognition. So there’s a way to do things. If you remember the old Shazam, right music app, Shazam could use automatic content recognition to tell you the song, right. And that’s really great for a song right? Because the song has a finite start middle and end it doesn’t change every time. And there’s only audio there’s no video. So while there is we use a version of content recognition for a different part of our product. For us, we needed to know exactly what that television ad was in which version of it was as fast as humanly possible. So what’s great about our watermark, and so the way it would work is within the first four seconds, we essentially pick up this this inaudible barcode in the audio stream that told us everything we needed to know. Wow. And we go great. So we know the exact version. Let’s say it was for a BlueCross BlueShield health insurance plan right running here in st Close. So we knew the exact station we know it’s running right now with then we actually know how long that television commercial is all that other data that we can, that we can store about it, which the client

Alexander Ferguson 10:11
has already put inside their content submitted for advertisers.

Brian Handrigan 10:16
So it’s all set up in our database. So again, within the first few seconds, we know the exact creative, our system then turns around and connects to that advertisers Google Ads account. So part of onboarding is right, we have a very simple connection process. And then the then the customer decides which campaigns or even individual keywords, and this is all self control the day there, it’s full power on their part to determine what things they want to amplify. Okay, and they can even put limiters on they can say, even if Google tells us that the bid is $200 per click, I don’t ever want to go over $54. So they have all that safety and security. So, first couple of seconds, we know the exact creative, we then turn around and automatically connect to the Google Ads API. And we ask Google to tell us first position bid by keyword for 500 or 5000 keywords, it doesn’t matter. Hmm. Google tells us that we apply some additional business rules like these bidding taps or, or even multipliers. And then we go in and we surgically algorithmically price, each individual keyword to be right price at that exact point in time here in St. Louis, if that’s where the ad is, right,

Alexander Ferguson 11:29
tell me a bit, both about your team as well as the client base, like what’s the growth and numbers wise look like? Yeah, sure. So again, so

Brian Handrigan 11:35
while while we did our minimum viable product two years ago, we actually spent most of 2018, building out a platform that was rock solid. So we launched just over a year ago, it was a middle of September of 2018, when we launched out of beta, and we started gaining some traction immediately. Because of our past histories. And being in the agency space. We understood the mechanics of annual health, health insurance enrollment time. So we got some initial customers, we had Roberta almost immediately, which was nice. But it was seasonal, right? It’s it happens during the fourth quarter. Yeah, um, the good news is all of those customers have come back and expanded. So much churn is low. Yeah, um, but, but we’ve really kind of spent most of them 2019 Working out our sales process. So our team has grown. So we had a very heavy engineering team, right during 2018. Right, we then added and in terms of our customer, you know, success and onboarding, our data analytics, and digital platforms are probably most significant recent hire was our Chief Revenue Officer, Amy, Bob Chad, who came to us she’d spent the last 14 years at Comcast spotlight. So she knew the problem from the other side, and saw the value proposition and she’s been a super add. So with customer adoption, you know, we had kind of a flat summer sales. It’s one of the reasons why we found Amy, as we want week, right? You can’t do everything right on the first try. So we, you know, our revenue is, you know, grew from 25,000 in monthly revenue in August to 45 in September to 77. In October, November is looking, so we’re on a pretty good path right now. Nice. You know, and our goal is to, you know, hopefully be around in over 200,000 in monthly revenue in q1,

Alexander Ferguson 13:24
what would you say, for other entrepreneurs out there? Over the last two years? What’s a hurdle you had to overcome? That? Maybe you can share some insight that learning that came from that?

Brian Handrigan 13:36
I think one of the things from a hurdle is I think hiring for startups is always difficult. Right? And, and there are two parts to it. One is we definitely want the best team that we can bring. And I think I think we talk a lot as startup founders, about bringing diversity to our teams, but we don’t know how I’m right. And so fortunately, Jeff, my co founder came across this, this, this survey assessment called the culture index, which the essence of it is, we all became who we are at about age 1213, things that drive us right? Are we more about hard charging ahead or worried about service to others? Do we like social interactions? Or do we like data? So there are these four core traits, right? And so one of the things we learned, and so Jeff found it, he’s like, Brian, you gotta, you gotta, you gotta see this thing. Somebody I’d never met told me who I was on the first call, and it was crazy. And then explain why Jeff and I are such an effective business partners. So we started learning more, we got trained in it, and we deployed it. And so for us, when we do a hiring process, we start by identifying the traits that a person needs to be successful. So if you’re in sales, you better want to win, right? Yes. Right. You know, and if you’re a software engineer, it’s about service to others and right and data. So there are these these in a trade

Alexander Ferguson 14:59
align lining their own in a trade to the specific role that you need them to play.

Brian Handrigan 15:03
Exactly. Because if the idea is, the more that the people are in alignment with the role, you end up with job satisfaction and happy people. Crazy, right? They’re gonna stay in the job longer. Yep. So so that is our first that’s, that’s our first test is our you have a profile type that is going to be able to succeed in the job. And by putting that as our first, our first hurdle versus looking at someone’s resume, we end now you get it, all of a sudden, a lot of unconscious bias is thrown away.

Alexander Ferguson 15:36
So two years in moving forward, you see the vision already potential revenue in q1, where do you see the business in five years from now?

Brian Handrigan 15:44
Oh, my God, five years is a long way. Well, you know, if you think about our business, you know, not as a television to digital platform, but the way we describe it is this intent arbitrage engine that uses signal data, right, in the offline world, primarily, to drive actions in the digital. You know, we have things coming out, you know, we have four core pillars of our product roadmap that include things like, you know, contextual based triggers. So are we are we processing all the closed caption streams and audio streams to find, you know, positive and negative sentiment with keywords, we think political is going to be an interesting year for us. Because with all of the restrictions of we’ll call it a call to Blackhat style targeting, we think we can be a white hat approach to more appropriate connections. So as we grow, I see us grown throughout North America, specifically, we’ve got interest in you know, from folks in South America, we’ve got interest over in, in the European markets, as well. So the goal is we become the dominant industry leader for this new type of advertising technology that is about connecting in a micro moment of intent. That’s what that’s what I see the next five years, right.

Alexander Ferguson 17:03
So both growth in and location, Nash, global opportunities, as well as the different industries and the timing with with elections and everything coming up. TV, there’s a lot of commentary around that itself, if you look isolated TV, on the decline, but what you’re doing is not instead connecting yourself only to just the traditional concept of TV. Is that correct?

Brian Handrigan 17:29
You’re absolutely right. I mean, so I completely there with you believe me, we hear that question all the time, right? Like, what are you guys doing? Because TV is dying, but it still was massive? Mm hmm. Right. And it is a complicated offline to online connection to me. So we have a very strong moat, right, with our intellectual property that we control, we’ve got additional patents we filed. So we don’t see dying anytime soon. However, that is, we’re not going to go the way of the buggy whip right manufacturers. That is not our business is about intent, not about television. Mm hmm. And so where we can build and where we can bring, right more intent based connections, that is what we’re going to grow on. And so that might mean audiences on connected TV ads, right, or on streaming services in a way that other people can’t do

Alexander Ferguson 18:20
moving forward. Aside from then the technology and how you apply this vision. What other hurdles do you see in order to realize where you want to be in five years from now that you’re gonna have to overcome?

Brian Handrigan 18:30
Well, yeah, there’s definitely on the capital side. Right. So our goal is, you know, and in some ways, I’d say the we work debacle, right. You know, it’s really helped startups because the prior view of the world was, okay, I’m gonna go to my seed stage and I raise I’m gonna keep burning capital and I’m gonna get my series A somewhere down the road, I’m gonna make money. Our approach has always been, we want to get to cash flow neutral cash flow positive, out of our out of our seed rounds. Hmm. So that we can decide when to do a series a for growth. And then that growth if we ever hit an economic bump, we can always turn profitability on Yep. And so we’ll use that as gasoline as rocket fuel but not as right we’re going to build a rocket ship

Alexander Ferguson 19:19
using it to build it as you go, you’re going to use it to fuel it so goes faster, exactly. Other particular blogs or podcasts or books that you’re listening to a reading. Yeah.

Brian Handrigan 19:30
You know, I’ve listened to all kinds of different books, right. I mean, one of the things I think as a startup founder in particular, that tends sometimes to get lost is is a is a commitment to being the best leader you can be right so whether it’s Extreme Ownership, right or Simon cynics leaders eat last, or, you know, different or the dream manager. I mean, probably if you look at my business book collection, uh, most of them are I’m just how to not be a crappy leader. Right? Because even though I think we’re doing you know, some Good things day in and day out. It’s always easy to forget. And so, you know, there’s that the other side is I do love kind of understanding, you know how businesses operate? So the current book I’m listening to is Bitcoin billionaires, right? With the Winklevoss brothers right? Doing their redo. And it’s, you know, so far it’s it’s really interesting. And really

Alexander Ferguson 20:23
last question I have for you is, of all the upcoming technology that’s coming out, what are you personally most excited about? Interested in?

Brian Handrigan 20:31
Hmm. Interesting. Um, I’m probably most interested in the idea of autonomous driving. Like in terms of pure technologies coming out, I mean, the complexity behind making that work and not killing people, because I like I just hate driving. You know, I’m, I’m notorious for being the guy that don’t, you know, get in the rental car, I’m not getting the driver’s seat. Right? If there’s somebody else with me, and we’re going to a meeting, I’m probably not driving. So I love the idea or the promise of being able to hop in my car get to a place and not have to worry about paying attention in the room.

Alexander Ferguson 21:08
Well, thank you so much, Brian, for joining us. Where Can folks go to learn more? And what’s a good first step for them to take? Yeah, sure.

Brian Handrigan 21:15
So if you want to learn more about us, we are at my avvocato.com. And the firt. The best first step is we have a couple of things. I think on our website, you can download some white papers, learn more, we have some case studies. And if you’re somebody that either is doing advertising on TV, and digital, or even if you’re not one of the things we’re working on is right with our with our competitive, you don’t actually have to have your own TV ads. If you want to activate against somebody else’s, you know, give us a call. We’ll get you in the sales funnel, and we’ll start a couple of months trial. My guess is it’s going to work because it hasn’t not worked. And then we’ll go from there.

Alexander Ferguson 21:55
That concludes the audio version of this episode. To see the original and more visit our UpTech Report YouTube channel. If you know a tech company, we should interview you can nominate them at UpTech report.com. Or if you just prefer to listen, make sure you’re subscribed to this series on Apple podcasts, Spotify or your favorite podcasting app.