Category Archives: Startup & Venture Capital

Talent Needs: Job Opportunities

One of the most amazing things about starting a business is being able to provide career opportunities for people at all stages of their life.  I’ve listed a few opportunities below and if  you or someone you know is interested in one of these, please do not hesitate to reach out.  The company is Varick Media Management which is the demand side platform and infrastructure for MDC Partners agencies and brands directly.  The team is located at 160 Varick Street in New York City.  I will refer all qualified candidates to the HR coordinator and the respective designee at VMM.

Investment Manager (Top Line Revenue Growth Driver):  Looking for someone with 1-3 years of experience to evangelize and drive top line growth of VMM to agencies and brands.  We are looking for someone who has experience in making the complex very simple; someone who is extremely personable; and who can present themselves well to a group.  Compensation is based off of a package of competitive base salary + performance + benefits.  If you are interested, please contact me.

Chief Marketing Officer (Strategic Sales):  We are looking for someone with 10-25 years in the business who has sold into strategic accounts ($10MM+/yr) for the past 5+ years.  Will be responsible for driving the direction of the Strategic Accounts as well, as, overall company marketing and identity.  Candidate may have an immediate open-to-hire for junior marketing coordinator to help with internal and external marketing efforts.  Responsibilities will be to drive top line revenue growth for the direct to brand channel and will have a new client goal quota.  Re-iterating that this person will be responsible for targeting specific clients (directly) and signing a specific number each year. Compensation is based off of a package of competitive base salary + performance + benefits.  If you are interested, please contact me.  Looking for someone who has played a similar role at former ad agencies, research firms, ad networks, and top tier publishers.

Infographer: We are looking for someone who is a master of data manipulation and visualization.  We’d like to bring someone on board who can tell stories once given a data set.  The ideal candidate will be able to recognize patterns within data, illustrate complex scenarios in simplistic forms, and create visuals that are easy to comprehend.  Visuals will be used both internally and also sent to clients to illustrate a particular problem or solution.  This role with support marketing, account, trading, and investment management.  Compensation is based off of a package of competitive base salary + performance + benefits.  If you are interested, please contact me.   Ideal background would be a mathematician + design.

VP Client Services (title to be figured out): We are looking for someone who wants to run the Client Services team and work closely with Investment Management.  Should have 10+ years experience within market research firms, agency brand planning or account management, or account management at complex advertising technology solution houses (ad networks, exchanges, etc).  Must be unbelievably personable, academic curiosity, a born leader, and detail oriented. If you are interested, please contact me.

Brand Capital & The Consiglieri

These guys get it and are for real.  I’ve known Mike Duda (@mikeduda) for a few years now and he’s onto something.  Let me explain why I think they have an opportunity to help create a new type of investor class that adds real strategic value.

The Front Man

Who doesn’t want to take a phone call from a player who has been a 2X NBA league MVP and 7x NBA All-Star?  Think you can get a meeting with someone?  I’m going to bet that Steve Nash can open more doors than the above average biz/corp dev person.  If you are one of his portfolio companies, Nash should be able to open the door anywhere.   For the sheer fun of it, I’d take a meeting with Mr. Nash and let him tell me about any of his portfolio companies.  Recently, WFAN 660AM took me out to breakfast with Boomer Esiason… a future hall of fame NFL QB.  That was awesome though the conversation wasn’t.  While the reporters loved Nash’s internship at Deutsch, I promise you that he’s not going to be sitting in the office working on campaign slogans… that’s the ad-mans turf.

The Ad Man

For those of you who are not familiar with Deutsch, it’s one of the top integrated shops left on Madison Avenue.  My agency, kbs+p is often compared to it and even Mike worked there back in the 90s.  Buddy Mike was one of the youngest partners ever at Deutsch and was directly responsible for some of their largest business including running the Anheuser-Busch InBev and Under Armour acccounts.  Duda also launched some businesses for Deutsch to much success and is highly regarded as one of the industries top ad-men operators.

Why Take Their Money?

In these frothy capital-rich (crazy to say that in a recession) days where it seems everyone is opening a seed/venture fund, the actual money to invest is just the table stakes.  What separates early stage investors from one another is the network that they keep and the value that they can add from a strategic and tactical planning perspective.  Many major early stage investors have been technical guys who were either product managers or startup CEOs that made it big… but I rarely, if there is even anyone out there, see people coming at it from a marketing angle.  Steve Nash has built his own brand which is world renown and Mike has built up multibillion dollar brands.  Startups need to understand how important their own brand is when talking to the world as it affects every conversation that they are having with consumers, investors, acquisitors, and potentials.

If you look at all the companies who get hyped on TechCrunch, TechMeme, GigaOM, AlleyInsider, and others, more times than not, their brand stands out.  Goodwill counts.

A Serious Bet

While GigaOM posted about another celebrity moving into tech with weak results, I see this celebrity having an awesome sidekick in Duda.  The area that I’d love to see them fill out is on the investing front end and they will have a nicely well rounded team.  Lets revisit this post in 365 days from now and see where they are… but want to send the boys’ Duda and Nash my most sincerest regards and best wishes!

Note:  I’m not an investor in their fund or currently working with them in any capacity.  I’m just excited to see some innovation in the space I love:  Marketing and Investments

Data Driven Platforms: Search & Display

Using data to make better business decisions is nothing new but since 2008, it’s been a very hot topic.  It’s been covered in almost every issue of Advertising Age, a whole new web destination now exists: AdExchanger, and agencies spun up new trading desks that are essentially high powered SWAT teams that combine rich data-sets with media for exceptional results.

Google has built a $154 billion company based on the use of lots of data to make the right decisions for it’s advertisers.  The data sets that Google are using are based off of search queries, which one can argue is one of the most powerful data sets that exist as it’s pure “hand raising.”  Over the past ten years, the big search engines have integrated with search engine marketing platforms such as Marin and Kenshoo to provide access to that marketers and agencies can use these tools to make better decisions which should improve performance and create workflow efficiencies (amongst many other reasons).

The trend we are going to see in 2H2010 and certainly in FY2011 is the emergence of these tools within the display, video, and mobile world and combining SEM with them.  While I can’t speak for any one tool directly due to confidentiality reasons, we are going to see many of these once SEM-only players move upstream to capture additional ad dollars and to use all-data (search+display+video+mobile, etc) to make better decisions.

As illustrated below, agencies such as Efficient Frontier are moving into this space as well, as well as, tools/platforms are integrating into biddable display sources.  These are not the only companies moving into the space but are illustrative of the trend.

What does this mean for the standalone display side platforms?  For the standalone SEM platforms?

An operational hurdle that will have to be addressed within the media agency world is that search and display is generally bought from two separate groups so either a) these groups will need to be combined or b) we need to provide clear roles and rules for each group.  I think option (a) is a much better choice as I’m all for integration.

SEM Platforms

The Conflict Free Ad Exchange

Picture 9Today’s ad exchange landscape is fairly complex but most people know who the big players are:  Google’s AdX, Yahoo!’s RMX, Pubmatic, Adnexus, Admeld’s MeldX, Adsdaq, Adbrite, and maybe, Microsoft AdECN.

With the majority of the above players including the big two (AdX, RMX), there is a major conflict.  They also sell media.

It’s like the Nasdaq also selling/providing liquidity for their shareholders.  Isn’t this a conflict of interest?

I know it’s early days within this space and most people are gravitating to where the money is.  For good reason.   Keeping the lights on and making a market today is better than being out of business in 12 months with only a dream.

When will we see a truly independent ad exchange emerge that can generate enough revenue to actually make it an attractive business for some group to start?  Behind closed doors, we talk about this all the time but everyone would rather be Goldman Sachs than the actual plumbing/exchange itself.  … and potentially for good reason.

I’d like to see a conflict free exchange emerge.  I’m sure many others would to.

Tangentially related posts:

This post was written by Darren Herman (@dherman76) who is the Chief Digital Media Officer of kbs+p/The Media Kitchen and the founder of Varick Media Management.  This post represents personal opinions and views, not necessarily reflected of his employer.

Big Companies Can Be Fun & Educating Too

I’ve spent more time in my working career in venture backed startups of less than 100 people than in companies of hundreds.  But for the past few years, I’ve worked in a mature organization of hundreds of employees, positioned in the marketing & technology services business.

One of the invisible badges that people are starting to wear in NYC (similar to Silicon Valley) is a “startup badge.”  The “in” thing to do is to work in a startup.   And there are many good reasons for that of which I won’t go into but on any given day, Charlie, Fred, Chris, Roger, and others are evangelizing (sometimes even myself!).

I’m going to play the contrarian tonight and say that while startups are fun and educational rollercoasters, there are many mature companies here in New York that have great opportunities.  Take a deep breathe and hear me out.

There are many stereotypes of working within a mature organization:

  • Lots of politics
  • Talent gaps (warm body syndrome)
  • Lack of creativity around compensation
  • Slow to move

You get the idea.

First:  do your due diligence and stay away from these.  If you can’t research companies and know how they operate before or during your interview process, you deserve to be in one of the above stereotypical companies.

While these stereotypes are for good reason in many cases, there are many reasons to join a mature organization in your young career, mid career, and/or executive career.

While each career stage has pros/cons and I don’t have the time to go into each and every one of them, I will highlight some things I’ve found over the past 2.5 years to be extremely helpful beyond early stage startups.

  1. Talent:  If you are into reading books, especially non-fiction business books, it’s fairly easy to align yourself with some of the authors you might love.  In the advertising industry it’s especially easy since it seems that every major advertising guru has written a book.  If there is a story/book you love and the person is still working, go work for them, you can learn a lot…
  2. Infrastructure:  Bigger companies generally have the resources to subscribe to services that normal startups can’t.  How many early startups do you know that subscribe to Nielsen, Comscore, MRI, Simmons, etc?  Access to these services can inspire big and new ideas which maybe is what you tackle down the road with a future startup.
  3. Compensation:  Spend less time worrying about if you are getting paid and more time solving strategic and tactical issues and opportunities.  How many pay-periods has your startup missed and what types of issues has this created?
  4. Access to Senior “People”:  The “people” is in quotes as it could mean a lot of different things such as clients, holding company execs, Wall Street, etc.  Big Companies generally have extremely tight relationships with very senior clients and exposure to them to learn about how they think, operate, and make decisions is priceless.
  5. Resource:  If you are in a company who has some free cash flow or wants to invest in a certain project or idea, it’s much easier to pull off in a larger company.

While the 5 reasons above are not bulletproof nor complete, big companies (mature) can provide a great opportunity for many in the advertising, media, and technology ecosystems.  While you don’t have to spend your entire career within a mature entity, there are many reasons to get your feet wet and to dive a little deep which could really benefit any startup you might build.

While startups are sexy, don’t underestimate the power of working for/with a mature entity.

Financial War: The Nimble vs. the Titans

A much smarter man than I said that competing with big companies is much easier than small companies.  Big companies are hard to pivot and change; so they either acquire you (good for investors) or you bring them down.  Actually, he said that today at the TechCrunch Disrupt Conference today in New York City.  His name, Michael Bloomberg.

Bloomberg is a trifecta for this post:  his quote, his background in finance, and his track record as an entrepreneur.

In the office, I’m responsible for digital marketing strategies for a few financial companies (no conflicts) that we’ve all heard of.  But a funny thing is happening on the way to the office.  Thru email and through introductions, I’m being introduced to about a half dozen startups that are tackling the financial sector.

Now is the perfect time.

You do not need to read another rant about Wall Street, as I’ll leave that to more financially-minded folks than myself.

When in a fight, you want to knock your opponent down when he’s hurt.  The bigger they are, the harder they fall.  During a professional boxing match, the fighters are trained to wait/observe for weakness and then attack.

Right now, banks are hurt and they are ginormous.  It’s the perfect time to go after them and attack.

2 financial companies are presenting at the Disrupt conference this week:  Plantly and Betterment (I’m assuming a play off the words “better investment”).  The third made press waves last week and is called Banksimple.  There’s even a fourth that I’m seeing ads for:  Ally Bank.

I don’t know the intricacies of each of their business plans, but they are certainly positioning themselves in a market where the nimble can out maneuver the biggies.  Also, being big these days in finance may not resonate with consumers so well.

This is an area that I’m watching.  If you are part of the senior team at any of these companies (or others), I’d love to chat.

Crunchbase Profile:  Plantly
Crunchbase Profile:  Betterment
Crunchbase Profile:  Banksimple

SEO for Television

A short and sweet thought inspired by Mark Cuban‘s latest posting on Google TV.

If we are finally in the early days of television/digital convergence, then Google is going to want to leverage their PageRank (probably needs a new name) algorithm to help TV viewers find content.

If you are thinking of getting into SEO, figuring out how TV will play a role will be extremely important; after all, there are $70 billion dollars in the US alone of TV advertising.

This is certainly an interesting area for entrepreneurial opportunity, investment, and understanding.

The Personal CTO

I think society is trained to equate CTO (Chief Technology Officer) with the formal corporation.  In many corporations, CTO’s are certainly needed and they play a vital role.

In your personal life (outside the office), who is your CTO?   In many cases, the CTO is yourself or a trusted friend.   Choosing technology is almost a self service ritual around research on sites like cnet, gdgt, google, tekzilla, and others to help you make decisions.  The amount of time you have to research your technology challenge determines what sources you use and the quantity of them.

But what if you didn’t want to use self-service to find technology recommendations/answers?  Can you call Ghostbusters, err, a personal CTO to help you make decisions?  As personal technology expenditures rise, I’d imagine that people would invest more time (and money) into the decision making process.

Two Types of Investing: Important for Entrepreneurs

While I haven’t quite been in the early stage entrepreneurial scene lately from an entrepreneurs point of view, I’ve been working with many early stage startups on both their marketing/go-to-market strategy and corporate strategies (fundraising, biz strategy).

On the way into the city this morning, I was listening to Squawk Box on XM Radio and they had on air Elizabeth Warren who is the chairman of the congressional oversight panel on TARP. You can watch the interview here.

Elizabeth broke down investing into two main categories:  relationship & numbers.  Very simple:  relationship as a category and numbers based as another category.

I’m not an economist and I certainly lack knowledge of the US Government (or any government for that matter) but let me try to explain something that she illustrated.  The government has cut back on relationship lending, or lending to early stage businesses:  loans, credit facilities, etc.  The cut back on early stage lending is DOUBLE the cut to overall lending.  Meaning, if you are a medium or large corporation, you have double better chance of getting money from the government than a early stage company right now.  This hurts us in the long term:  while many of these early stage companies may die, many will go on to be the big corporations tomorrow, and if we’re not funding them today, what will happen tomorrow?

The point of my post is not that of above but rather this:

Relationship lending is pretty much early stage investing.  While I’m taking liberties and equating this to venture capital:  early stage investors really have no numbers to look at… it’s all based on an idea and your relationship (either new or old) with a particular venture investor or angel.  Relationship lending in the public markets is drying up as illustrated above (for now) but it seems that the angel scene and venture capital scene is hot right now.  The most important thing for entrepreneurs to do right now is get out and meet/mingle with as many angels/connectors/venture folks as possible.  Without a relationship, folks like Chris Dixon, Josh Stylman, Ron Conway, and Chris Sacca are not going to take a peek at you.  Relationships are key.

Numbers based investing is where balance sheets are key.  Strong numbers mean great leverage for the company when raising money.  Because of the early stage nature of most venture capital/angel deals, numbers based investing is pretty much rare until you get on to Series B, C, D, and Mezzanine rounds.   The public markets is all about numbers based investing.

So, if you are early stage and your raising money based on relationship lending my word of advice is to get out as MUCH as possible and meet/talk/mingle/get to know people and build a relationship.  It’s not enough to be a “friend” on Facebook.  Earn people’s respect.

The Marketplace Appreciates Obfuscation in Pricing

OpenPricingPricing is defined as the property of having material worth. Pricing though does not dictate individual value, but rather the value of a good for the average.  Let me illustrate by an example:

Sherri walks into CVS to purchase some shampoo for the Herman household.  She sees Pantene for $6.45/bottle or Sunsilk for $9.99/bottle (totally made up numbers).  Sherri has a specific price in mind she wants to pay for Shampoo based on her proprietary valuation system (special needs, bottle shape, accessibility, etc) and based on this specific value, she is able to decide between Pantene and Sunsilk.

Pantene and Sunsilk are offering (pricing) their products at these price levels because they have done a comprehensive supply/demand curve and have optimized where they should price their product for the optimal (not always most) amount of buyers.  This is done through market and competitive research as well, as, historical sales scenario planning data.

In this scenario, the marketplace appreciates pricing obfuscation:  it’s simple for the consumer and it’s simple for the business.  The consumer never sees the profit margins (unless they are purchasing from a public company and even then, how many consumers read financial reports) and the business never knows how much the consumer was really willing to pay (potentially more).  There is not really a tension here – if a product’s price is not adequate for a consumer, they will move onto the next product on their list.

It’s simple.

For the media/advertising world, things are changing.  A once very opaque industry is changing.  Agencies and brands are becoming much more quantitative and are understanding how to value inventory for the first time (I took liberty for “first time”).  Most publishers do not appreciate this – and the obfuscation/opaqueness that once existed that provided healthy margins is dissipating.

Let me reprhase the last sentence:

Most publishers do not appreciate this in the short-term.  Historical obfuscation of pricing/valuation has lead to healthy margins that have existed for years (why do we have 3 Martini lunches? Why are media teams making custom nike sneakers with reps?) for the sell side.  The long-term opportunity is tremendous, if the sell side could get over the initial short-term shock.

Some say that the bigger they are, the harder they fall.  The problem with this is that the major media companies such as Conde Nast (Advance Publications), Hearst Corp, and Tribune are all very large private companies and are potentially going to fall very, very hard.  Note:  I’m not saying that they cannot get back up again… They can.  But they are going to have to fall first.

If/when major media buyers (marketers, agencies grouped together) have the ability to buy on value, not price en mass, this will be a major market shift.  Some of us are here today but when even more of us are here tomorrow, the sell side will become much more comfortable as more dollars move into the industry to satiate cash flow statements.

Since however the market appreciates obfuscation in pricing (it’s just plain simple!) we may never get to this efficient place, but it would help the actual buyers and sellers reap much longer term benefit that short-term margins.

Please comment below to continue the conversation or tweet @dherman76 with replies