Transcript:
<strong>This podcast was transcribed through a third-party application. Please disregard any misrepresentations.</strong>
Mark Eckerle:
Welcome to this episode of founded in tech. I am your host Mark Eckerle. And today I sit down with Simon Adell, who is the CFO of triple lift, who is bringing the digital advertising ecosystem to the next level. On today’s episode, we discuss the ins and outs of TripleLift’s business model and operations, how they not only survived the COVID-19 pandemic, but also ended the year doing fairly well, all things considered. And then finally Simon offers some tips and tricks he has come across throughout his career as tidbits of advice that could be helpful to other entrepreneurs, founders, and even beginners just starting out their career. It was great chatting with Simon about TripleLift and the exciting things that they’re working on. And I hope you enjoy this conversation as much as I did. Hello everyone, please join me in welcoming Simon, Adell from TripleLift to the show. Simon is the CFO of TripleLift and joins us today to talk about his background, his company, TripleLift, and some of the exciting things that they’re working on. So welcome to the show today.
Simon Adell:
Thank you. Thank you very much.
Mark Eckerle:
Awesome. So, so jumping right into it, um, I guess before we get to TripleLift, why don’t you tell us a little bit about yourself, your background and your career, and kind of how you became the CFO of TripleLift?
Simon Adell:
Yeah. So I’ve been, uh, I’ve been a tech startup CFO now for jeez long time. I can’t even think, but it’s, it’s a while I’m definitely a veteran on the scene and, um, I’m actually Canadian. I started my career in Canada. Married an American ended up in New York city and, uh, a couple of jobs later. I ended up at TripleLift. So I’ve been a CFO now since 2004 at, uh, in a few different industries, mainly financial technology. And, um, I did a stint in energy and now I’m in uh now I’m in advertising.
Mark Eckerle:
So have you, have you always been in the FinTech space or did you kind of, kind of see a, an emerging technology and you kind of wanted to get hit it from the ground up or what kind of drove you into this space?
Simon Adell:
Well, yeah, it’s interesting. Like my last company was, was, uh, was selling the last company I was at, which was, was a FinTech company. And I was just looking around a recruiter told me about TripleLift. I didn’t know, TripleLift. And, uh, honestly like to be totally honest at first, I was like, what do they do? Advertising digital advertising, no, not interested. Ads are annoying, not interested. The recruiters just kept on me and he said, just meet these three founders. They’re the real deal. And, uh, do me a favor, meet them, meet, them, meet them. I did a little bit of homework on the founders. I found out they had great reputations and, uh, I agreed eventually to, uh, to go to meet them. And I was immediately impressed. I didn’t know much about the space. It’s actually a really complicated space, uh, digital media advertising.
Simon Adell:
And, uh, it takes, it takes a while to sort of get your head around it. Um, but it’s actually really fascinating and from sort of a CFO perspective, it’s it doesn’t get any better than this. Huge volumes, tons of data, everywhere stuff happening, deregulated just hypergrowth, especially at TripleLift. It’s, it’s, it’s really a wild ride, so I’ve really enjoyed it. And, uh, I’ve actually come to realize that actually there’s a really noble mission. I didn’t realize at first, I didn’t know anything about the industry. I just thought ads were annoying, but as I learned what ads do and how they support content and, uh, keep us from all being, uh, getting all of our news just from Facebook, uh, and other platforms like that, I came to realize that we play a really vital role in the, in the world. So I’ve, I’ve really enjoyed it.
Mark Eckerle:
Yeah. And I, I could see how kind of, um, like joining this space it’s taking on that role of a CFO it’s every day is something different, right? You’re not going to have the same monotonous day in and day out activities. Um, so it’s, and especially in such an emerging technology and emerging space, there’s, it’s always something new, right? There’s always a new hurdle to tackle a new challenge that’s facing you. So it’s, it’s constantly changing, which keeps things exciting, you know?
Simon Adell:
Oh, always. And, you know, as a CFO of a smaller company, I mean, even now we’re 320 people about, um, you do a lot more than just, you know, finance or accounting. I would say. I mean, especially when I started at TripleLift finance, and accountant was at most half of my day, realistically, more like a quarter of my day and just general operational type things where sort of the rest of it. And that continues now more, a little more finance now, you know, more specialized we’re bigger, but, uh, you have to wear so many hats really in almost any job environment
Mark Eckerle:
In startups. Yeah. You’re wearing multiple hats, like you said, so accounting is only a part of it. Um, so, so walk me through that, that meeting with the founders, right? Like talk about how the company TripleLift and, and how you kind of hit the ground running. What, what really sold you on the company? What, what was your, your first experiences like?
Simon Adell:
Well, I, I mentioned that the founders and the rest of the management team, who I met in the interview process were, uh, were, were just seemed really, really sharp and that’s turned out to be true. So I just thought, yeah, this seems like a good, uh, uh, horse to hitch my wagon to. And, uh, Andy and I went. And so the first impression is TripleLift just happens to have a certain energy about it. It always has. When I walked in, I was like, wow, this is, this place is, this place is crackling. And, uh, you know, I was drawn to that. I liked it. So get in and dive in. I do joke that I could not have passed the interview process that a lot of people in more junior roles than me seem to get put through at TripleLift, like interview panels and all kinds of assignments and stuff. I didn’t really have any of that. I mean, maybe our, our founders, it’s their first company amazingly. That means that the successful in their very first startup and, uh, maybe they just didn’t quite know what to ask the CFO. They certainly asked me a lot of good questions, but I, it was much lighter. I think it’s fair to say for me than for, you know, some of our much more junior people. So I feel, uh, I feel grateful. They didn’t ask me too many hard questions. I’m not sure how I would’ve done
Mark Eckerle:
Done if you were interviewing today.
Simon Adell:
I think it’s safe to say, just walking in previously, I would not get the job at TripleLift now, but I wasn’t applying for that job. Right. We were just a little over 60 people. We did 15 million in top line revenue that year in 2015. And we just closed our series B, which is a very typical time for a CFO to come on. And usually like the investors at that point say, you should have a CFO. And I think that’s more or less what was happening at TripleLift at our board. And, uh, you know, finance was outsourced at that time. My finance function was completely outsourced other than one of the founders was, was handling the finance function. But you know, that wasn’t, he’s, he’s our head of technology. So that wasn’t his, his main job and, uh, you know, 15 million, 60 odd people. And last year, 320 people and 500 and almost 560 million. So it’s been, been rapid growth. Yeah.
Mark Eckerle:
That’s awesome. Great numbers there. So, so kind of walk us through, into the TripleLift model, right? So you joined in 2015, here we are in 2021. So roughly six years, five and a half, six years or so, um, with significant growth, both on the headcount side, as well as operations. So kind of let’s take a deep dive into what TripleLift does. What besides like digital advertising let’s drill into what that is for our listeners.
Simon Adell:
Yeah. It’s, it’s, it’s a, it’s not the easiest to explain. So I’m going to share a screen on my screen. So we’re, what’s called a supply side platform, our SSP, tons of acronyms. And so we, we consider ourselves in the ad technology, the AdTech space, right? It’s, we’re a technology provider in the advertising space. We don’t actually do advertising ourselves per se. So I’ll share my screen here. And so here’s somebody on a phone and this person has gone to Southern living, which is a website and Southern living is interested in making some money to be able to stay in business, which is, as I mentioned before, not an easy thing to do as a publisher these days with Facebook and Google, between them taking up about two thirds of all the advertising spend that happens. So suddenly we can make money by charging a subscription to people who come to its website or doing e-commerce or putting ads on this page, or some combination there out, there are no rules about it.
Simon Adell:
So it’s whatever they, they choose to do most sites, especially ones that aren’t sort of the best known like New York times has a lot of paying subscribers, but something like Southern living is a little more smaller, more niche publication. It, um, it would probably use, um, advertising to monetize its site. So what happens here is this ad here is placed by Canon. So Canon is the brand and Southern living is the publisher. So what we do is we just connect those two, not just it’s, it’s a complicated process.
Mark Eckerle:
There’s a lot going on in between them.
Simon Adell:
There’s a lot going on, right? So the part that blew my mind about this when I started was I just didn’t realize how complicated this is. Like, I just sorta thought that like Canon and Southern living like Canon was just on this page. And when I go to this page, like I would, of course see the Canon ad, cause it was already there, but actually that’s not what happens at all in about 90% of cases.
Simon Adell:
What happens is this ad is run, what’s called programmatically and TripleLift is a programmatic first company. And what that means is everything’s done electronically basically automatically. And this ad, when a person goes to this, to this, uh, Southern living site on their phone or on their computer tablet, whatever, uh, the, uh, Southern living sends a signal to advertisers saying, Hey, I’ve got somebody on our site who wants to bid to be able to place this ad. And then an auction happens and the high bidder places gets the right to place this ad. And that all has to happen in three tenths of a second. The ad has to get shown in three tenths of a second is the rule of thumb. Otherwise people will, will leave the page if it’s too slow to load. So there are actually in a lot of cases, like thousands of brands who bid on this space and the dollars on a very small, be about one 20th to one 30th of a cent to be able to place this ad here.
Simon Adell:
So it’s a volume game. You need to have a lot of, a lot of use and a lot of, a lot of, uh, a lot of ads, uh, from a lot of people on your site in order to make enough money to, to be a business. And this honestly kind of blew my mind when I started, I was like, wait, like that ad wasn’t there, like Canon didn’t know I was there. You know, suddenly like what, what happened? And like, no reload, reload the page and we’ll see you next time you get like a different ad, maybe from somebody else. I, you know, it can be like a car commercial or something, and this all happens. And there, as I said, like there’s an auction going on and even more incredible to my mind was that multiple auctions happen. So we’re one supply side platform.
Simon Adell:
Southern living probably runs multiple auctions, usually five to six auctions, parallel auctions. So like whoever wins our auction, we pass that winning bid in this case, Canon, to Southern living and that big competes against five other options happening in parallel. And so the winner of those five auctions places gets to place the ad. And at the end of the month, we invoice Canon, you know, like one 30th of a cent and we take a revenue share for ourselves. Then we pass the rest on to the publisher, Southern living.com. Like I was just, I seriously couldn’t believe it. Even now thinking about it, I’m like, seriously, that’s how it happens. Like that’s so complicated. Like how can like that? How can that work? And the answer is you need middlemen technology providers like us who make it work. We provide, we make it possible for in this case, a Southern living just to connect to us.
Simon Adell:
And then we connect. There’s actually one more step in the chain demand side platforms that connect us supply side platforms to the brands here, which is in this case Canon, so Canon is what we call the buy side. And Southern living is the sell side, the supply side. And so, you know, we’re a marketplace, we need both. So you need liquidity. So it’s all about balancing supply and demand. So, and that happens many times a day. It’s funny, the first week that I started, I, I went home and I told my wife, I said, this pretty small company. I started out, they get 200 million of these auction requests today, but she said, that can’t be right. That’s way too high number, like company, small 200 million. I said, yeah, you’re right. Maybe that maybe I misheard, or maybe that was like a full year or something. I went back the next day and I said, 200 million outset. Is that really what we did? And Oh yeah, 200 million. Well, that was a long time ago. Here’s where we are now. So now we’re doing about 40 to 45 billion a day, and we’re still actually one of the fairly small, relatively we’re growing fast, but still one of the smaller SSPs out there. So the scale in this industry is totally crazy. It’s, it’s absolutely amazing what we’re processing 45 billion auction requests a day. So, wow.
Mark Eckerle:
My mind is pretty blown right now by this whole concept. Yeah, the fact that there’s-
Simon Adell:
Full time and like all this like auctions happen and all the settlement has to happen. And all the collection and working capital cycles are long in this industry. People take months to pay. And so it’s a complicated, it’s a complicated business.
Mark Eckerle:
The, the fact that there’s the bidding or auctioning process behind the scenes, and it all happens in three tenths of a second for a website to load, but there’s not just one auction. You said, there’s, they win the bid for TripleLift. And then it goes up to against competitors for the website of Southern living, who have they also engaged with. So the fact that there’s that process all behind the scenes in three tenths of a second is
Simon Adell:
I know. Latency and page load are major, major factors in this, in this business.
Mark Eckerle:
Hmm. So, so to put it a little bit in perspective, uh, from the numbers you provided earlier, so you were doing 200 million, um, requests a day, and that was roughly 15 million you did.
Simon Adell:
Uh, so we were doing, I mean, when I started with 200 million a day bid requests, and now it’s 45 billion a day. So a trillion a year last year, we did a little over a trillion, a trillion requests and we have to process every one of those were hosted at Amazon web services currently. And you know, every single time we, we have to listen to all of those, those bid requests and process them in some way,
Mark Eckerle:
Now all of this is obviously automated, but by computing power, all of this is obviously automated,
Simon Adell:
Completely automated.
Mark Eckerle:
But what’s the difference here between, um, I guess this, this auctioning process and then like targeting, targeted ads. So what’s that kind of process. And do you guys work in that space as well? Cause I know for instance, if I go to a website, it may be an advertisement for a company I was on, on my computer last night or something to that effect.
Simon Adell:
That’s a great question. So, um, that’s just a certain set of advertisers use that as a, as a tactic it’s called retargeting. Um, people can retarget through TripleLift. It’s not, we we’re sort of agnostic to the tactics that advertisers choose to use. So we don’t, um, we don’t do the re-targeting, but people can use TripleLift to do retargeted advertising. It’s got pros and cons. Um, one of the big challenges that’s facing retargeting actually as a, as a tactic. Uh, well, first of all, it’s got pros and cons pros are, it can be very effective. Um, the cons are like, it can feel really creepy to people, right? Like at the a canonical example,
Mark Eckerle:
Like they’re watching me? That’s what everyone says right there. Someone’s watching it,
Simon Adell:
Stalking you around the internet, right. It can be really annoying. Like you already bought that product and that they don’t have sort of a closed loop attribution set up. Like they don’t realize that they’re, you know, they’re targeting you for something you’ve already bought or whatever it is. And, um, so the, uh, another, uh, major challenge on facing that tactic of retargeting is that it relies on cookies and cookies, generally speaking are, are going away because of privacy concerns. In, in my, in my opinion, honestly like misplaced privacy concerns, privacy is, is very important and, uh, you know, is key. And I’m, you know, I love privacy just as much as the next person, but the information that’s passed around in cookies is, is actually fairly, is, is fairly benign generally. And so it’s probably a little misguided. The real privacy concerns are one of the platforms like Facebook have like tons of information about people because people willingly give it to them.
Simon Adell:
Like they know how many often people say how many kids they have or where they live, or all kinds of things like that. I mean, much more, much more, uh, concerning. And so I think a lot of these anti cookie initiatives are sort of designed thinking about like the Facebook use case and like Cambridge Analytica and that sort of thing. And like, we don’t, we just don’t have any ability to, to obtain any sort of data like that. And, uh, but without cookies retargeting basically can’t happen. So it’s definitely a concern for, for, for advertisers that use retargeting as a tactic. Um, so there you go. So, you know, we would, TripleLift would be affected to the extent that those advertisers would be effective. It would be affected, it would no longer be working in advertising generally. And, uh, we’re, we’re thinking hard about, um, different approaches in light of, uh, the probably inevitable decline of cookies.
Mark Eckerle:
Yeah. The, the privacy debate is always something that’s kind of interesting because, um, in today’s day and age with various corporations being hacked or something, and people are starting to become a little more, um, protective of their data, but then they’ll go and sign up for Facebook and not realizing that that data is just being sold.
Simon Adell:
I should, I should distinguish between first and third party cookies. So first party cookies are where you personally say, yes, I consent to this. And third party cookies are where you don’t know that there’s like an advertising provider involved, that you go to a website and the publishers using a third party like TripleLift, and you’re not aware. So that’s called a third-party cookie. So the focus around, uh, cookies is around third-party cookies, not first party. So by the way, that’s why you will inevitably have seen now when you go to a website, well, several things, but one thing is every publisher basically tries to get you to sign up for their newsletter or something. Right. And the reason for that is that’s first party information. They can then drop a first-party cookie on your computer and continue to do targeted advertising or other things around, uh, advertising with a little bit more insight into who you are, and that’s not going to go away first party cookies. So publishers know that third party cookies probably are going away. We say the cookie is crumbling. And, uh, so, you know, they’re getting increasingly desperate to get people, to sign up and give their information to them.
Mark Eckerle:
Yeah. I feel like every website I go to there’s.
Simon Adell:
Obviously, I’m interested. I’ve been interested in this argument, but there’s really nothing. There’s nothing going on with cookies. Like if they’re not a major privacy concern, it’s a little bit misguided, as I said, privacy is definitely a real thing, but the focus on the cookies is probably a little misplaced.
Mark Eckerle:
Okay. That’s good to know. I mean, it gives some people, a little bit of assurance there.
Simon Adell:
Um, so we know nothing about like, we know nothing about anybody at TripleLift like, and, you know, we don’t want to, but like literally, like we know nothing about you virtually nothing. So,
Mark Eckerle:
So, so are there any other, I guess, business operations, I know TripleLift has some international subsidiaries. Are you guys primarily located or do most of your business in the United States or what does that look like worldwide? Um, can you distinguish the differences from a user, I guess the, their IP, or is it more so from a, a buy-side slash sell side where they’re located?
Simon Adell:
Uh, like, yeah, that’s a great question. So here’s, um, here’s how our revenue looks like internationally. So you can see it’s being growing, but it’s, you know, it’s those sub 10%. And we jumped all the way to 13% in 2019, and we got to 14% in 2020, we’re hoping to grow that share a little bit more North America is us plus Canada. So you can see that that’s, that’s definitely the bulk of our activity. This is where, yeah. That’s where the person on their website is located. What I just showed you there. Okay. Now I’m giving you-
Mark Eckerle:
The user, I guess, the end user.
Simon Adell:
That’s right. I don’t really like to say user, but, um, consumer.
New Speaker:
Where I’m located.
Simon Adell:
Now I’m going to share again. And so now I’m going to show you where by country. And I find this one of the more, again, back to this notion that like data is out of control.
Simon Adell:
Like, so here we’ve got United States was 420 million. This is through partway through December. Um, you know, in the year, our largest ones, it’s all the sort of major developed countries that you would think of. And then here are the smallest in the second table and you can see there’s like Western Sahara, which a lot of people, I didn’t know, as a country.
Mark Eckerle:
I did not.
Simon Adell:
Georgia in the South Sandwich islands, my wife and I were listening to something on NPR the other day. And they mentioned South Georgia and the South sandwich islands. And we’re both like, have you ever heard of that? I said, you know, I think that might be on like a slide that I used the other day. And, uh, and it was, and went and checked and what you can see, it’s like, I actually it’s, uh, I can’t quite see cause it’s blocked here, but, uh, I think it’s like 40 cents or something.
Simon Adell:
Right. It’s maybe even less. And then North Korea, this is one that really blows my mind. Like there aren’t even there, I didn’t think there was an internet, the internet in North Korea, but there is, and we have like a few pennies of ad spent coming from North Korea, which is crazy. So if you dig in and you look which I’ve done, it, it’s mainly like European, mainly UK. I noticed, uh, newspapers that are running there. So maybe it’s like some journalists who are like in the demilitarized DMZ the demilitarized zone and they’re able to access their phones or something. I’m not really sure, but that’s totally crazy. Now, keep in mind, I don’t have to invoice North Korea cause good luck collecting on 25 cents out of North Korea. Right. I can’t imagine what they pay me in, but uh, you know, this, this comes through those big demand side platforms that I talked about. So I’m invoicing people in, you know, the UK or, or United States to, and uh, for, for this money here.
Mark Eckerle:
Interesting. But yeah, it looks like a bulk of yeah. 420 million from the United States and that’s that’s top line revenue.
Simon Adell:
Yeah. That’s right.
Mark Eckerle:
Gotcha. Interesting. Okay. Yeah. It’s good to put it in, I guess, perspective where, where users are and kind of ads are being targeted from, um.
Simon Adell:
They’re everywhere is the point, right?
Mark Eckerle:
Everyone uses the internet.
Simon Adell:
Well, remember these are people who are like, not just on the internet seeing it, it’s like they’re seeing TripleLift that it’s like little TripleLift. Like somehow we have ad showing, you know, and like St. Helena here and Comoros and North Korea. So again, just like.
Mark Eckerle:
40 cents from North Korea.
Simon Adell:
When I tell people joining that we’re recruiting, we’re recruiting for the finance team, I tell them, I say from a finance perspective, this is kind of a dream job. Like, you know, if you can make it here, you can make it anywhere having to handle this level of data. It’s really something that’s really pushed my business intelligence chops. I’ll tell you really developed them in the last five years out of necessity.
Mark Eckerle:
Yeah. That’s, it’s interesting to put it in perspective like that. So, so for the international piece of it, I know there, there are a few international subsidiaries of the company, um, is the primary benefit of that for a tax perspective or, or what was the reasoning for treating international subs? Correct.
Simon Adell:
Tax is overrated, overrated, that stuff is unless you’re like Apple, that’s honestly I’ve wasted time, like chasing like tax, you know,
Mark Eckerle:
I don’t think our tax folks would be too happy to hear that.
Simon Adell:
Inversion and all that. And honestly, since the changes in the corporate tax rates in the U S in like 2017, like there’s, there’s really not much there tip though to all you CFOs out there. And the money is hiding in plain sight. It’s salt, state and local. That’s where I found like the money is when you’re profitable. Like we are start to you start to think about that. Um, so no, they’re, they’re they’re sales offices, right? All of our international offices, all of our operations are handled out of the U S but we have sales, both supply side and demand side, uh, business development in all of those, those countries. So France we had in Germany, Australia, we’re going into Singapore this year, a couple of other European countries. So Canada, they generate demand and supply falls over. Yeah, yeah. International it’s difficult, man. International is difficult. The two most difficult things I think in this business. And honestly, probably in a lot of business are international. You have international operations. There’s just so much like so many things you have to think about, it’s think hard about going international. Like, you know, it makes sense if you could do it and you’ve got enough demand that, but be careful international is challenging. And I was going to say the other one is like credit management, but we’ll talk about that later, maybe. But,
Mark Eckerle:
So, so as I think this is a great transition, as we’re talking about international, um, operations, the 2019, the COVID-19 pandemic, how has that impacted the company? Right. So it affected the entire world, um, and, and TripleLift is all around the world. So what kind of impact has that had on the company? What were your main concerns as this kind of really started to come to fruition in early 20, 20? Um, January, February, it really, I think hit the United States come March when things started to get shut down. Um, what were your main concerns and how did, how did you guys kind of transition to, to where you are today and where the company?
Simon Adell:
Yeah, it was, I mean, obviously existential for us, like many people, the, um, the, we had a notion that there was going to be like a significant, you know, market correction. Now we weren’t trying to time it, but it just, there’ve been a lot. I’ve been through a couple of major recessions before in my career. I mentioned I’ve been around for a while before, so the.com bust and then, uh, 2009, the Lehman brothers stuff and, um, the great recession it was called then. And, um, so, you know, it’s just been a long time. It had been 10 years. And so I happened to give a presentation to our management team in, um, early February about how we were thinking about an economic potential economic downturn and what we’re doing to prepare for it. And the answer was like, we knew one would eventually come, but we weren’t going to try to time it, but we were going to try to, and we, weren’t going to try to time it because then you just missed too much upside because honestly, like I thought one has been coming for the last few years and, you know, every year it hasn’t happened in the last year.
Simon Adell:
And although I did say, I said, as soon as it happens, I’m going to be the first one to say, I totally did first. Right.
Mark Eckerle:
You were the first one there.
Simon Adell:
I was, I was the smart guy and inevitably I’m sure people are going to claim that after this is all over. Um, so what we did do though, which was smart, was we maintained where possible operational flexibility and the main place where that manifested itself was we did not get into any long-term, uh, office leases. And, uh, so we did not have anything for more than the max one in all of our offices we have about, I don’t know, 10 offices or so like, that we paid for around the world. And the maximum time we had on any of them was, was 12 months when this hit. So that was great. And our big one in New York, we had only about seven months to run.
Simon Adell:
So that, that helped us. It gave us a lot of flexibility. So those are, and you know, that came with a cost, like you pay a premium for having that kind of flexibility. Uh, but that, but that was good. So anyhow, so when it hit, I mean, it was cataclysmic, right? Like, you know, we’ve never seen anything like this in the last century. And, uh, it, you know, it was terrifying and from a business perspective and this one was different, cause it was terrifying literally from like a health perspective. Right. And so, you know, I came down maybe with the virus, I don’t know, but I was really sick at the start of it. So I went sequestered myself in a hotel and you know, all hell was breaking loose and as you would expect, and it was very dramatic that day. We left the office, you know, we gathered the, the management team together and we’re like, we’ll keep an eye on this.
Simon Adell:
We don’t know what I don’t know. And then my phone rang was the landlord. He said, somebody on the floor below you has just tested positive. Like everybody hold on for a second. And, uh, you know, we gathered everybody within an hour, we shut the office down and we never went back. And, um, you know, so there I am in a hotel and our executive team was meeting. I mean every single day, you know, multiple times. And, uh, we, we came up with a plan. So our revenue is very cyclical, sort of quarterly. And, you know, end of first quarter was coming and we knew that there was a quite a bit of spend still happening, but it felt like it was like sort of zombie spend that was calling it like zombie campaigns that were already paid for it. And we’re still running and like what was going to happen on April 1st, which is always a drop in revenue for us.
Simon Adell:
And, uh, you know, unlike a lot of SAAS companies, like we don’t have contracts with our customers, which I think is great. I think that’s super customer friendly, but like you are not mandated to buy or sell a specific amount on TripleLift. It’s come and use it. And those auctions that I talked about, if you win the auctions and then you get money and if not, you know, you go somewhere else. So, you know, that left us exposed, obviously not having those contracts and, um, you know, it was terrifying. And so we spent a ton of time, a ton of time trying to make our best estimate of what was going to happen to demand on April 1st. And, uh, we thought that it was going to drop and, you know, our best information was maybe was going to drop like 30% below where we originally expected.
Simon Adell:
And so what we, we had to make really hard decisions and we had to reduce our costs. We had previously planned to make a 10% EBITDA profit margin for the year that went out the window when we were just going to try to break even, and we’re not a company has raised a ton of money. We’ve raised 16 and a half million dollars, or, you know, very little in the scope of how large we’ve gotten. And, um, so we didn’t have like, you know, $50 million in the bank or anything like that. And, you know, it was absolutely existential to the company. Like we had no idea what was coming. So we had to make some really hard decisions. And so we did some small layoffs, which is very painful. Uh, those were people who just thought like, or unfortunately in positions that were permanently no longer fits, mainly office management, which was rolled up to me.
Simon Adell:
So those were friends of mine that I’ve worked with for a long time, a lot of them. And, you know, we gave, we had to give severance packages to those people and, uh, and then a larger chunk of people we put on furlough. And so we furloughed those people for up to, I mean, at the time it was three months, we said. And, um, and so they were able to continue to get benefits, but no pay, everybody else took a pay cut, you know, up to 25%. And, um, twenty-five, you know, for executives and senior managers and that was it. And so like, we thought that, you know, if we hit our, you know, our new number, we could, we get, um, we can stay in the business at that, at that level. And Jesus, like, I’ll be darned, but like we nailed it that, that 30% drop from our previous plan, like that is exactly where it landed.
Simon Adell:
So that first day of April 1st, I was like watching, like our spend, like every minute practically and I mean, it was terrifying. And, uh, you know, again, like not terrifying from a health perspective other than like the actual health perspective. So I don’t want to like overdramatize it versus like people who are like real frontline responders. Like they obviously had it, you know, much more difficult than I did or anyone at TripleLift did, but from a business perspective, you know, everything that we’d worked for for all these years, that was absolutely terrifying. We had no idea what was coming next, but, um, we did manage to get, you know, we did manage to estimate where that was going to come in. So I have a really interesting chart here that I’m going to show you.
Mark Eckerle:
Just, just for the listeners really quick, that 30% drop was that your ex cause I know you said on April one, um, with the, the SIPI cyclical sales, is that, was that, uh, expected or is that below what you already expected to drop
Simon Adell:
We dropped at 30% additionally below what we expected.
Mark Eckerle:
Okay. So on top of your already expected, somewhat dropped
Simon Adell:
That’s right. That’s right. Yeah. So here’s, so this chart is interesting. It shows how we did against our original plan every day, uh, of last year, that’s the green line. And then this pink line is the, is the cumulative total for the year. So you can see that we started a year out like gangbusters, you know, January was like, you know, well, over a hundred percent the plan. And then February, I think maybe we just had like a little bit more aggressive plans, but like, we were like hanging in around a hundred percent and then, you know, stuff started to happen in mid February. And this is where the trouble, you know, came and stuff was already petering off pretty badly through March. And then you can see, like, it just fell off a cliff, right. April and may. So we were down as low as like 50% of our original plan. And, you know, so here’s the cumulative number. So we were down here, you know, 25% below plan. And then geez, like it was an unbelievable, it’s like a light switch, right? The first week of June, it just snapped back. I mean, look at this slope of this green line here,
Mark Eckerle:
I was just going to say what, what triggered that, cause that is a drastic increase basically right back to a hundred percent. And it looks like around the June timeframe. Yes,
Simon Adell:
That’s right. It was just the advertisers sat on the sidelines for two months while everybody figured out what the heck was going on. And then things were arguably recovering a little bit. There was a lot of reopening going on here, you know, arguably too soon or whatever, but like that’s what was happening and advertisers, you know, advertisers in the business of, of advertising and reaching their customers. Um, and so like they wanted to do it. They hadn’t been doing it on a relative basis for two months. And so they got back in the game and as a result we did too. And so here we are, you know, at about a hundred percent now at this point we brought back, we actually started early. As soon as we saw this we, we started bringing people back the furloughs. So some people came back within a month, uh, and within three months everybody was back, you know, we were good to hear through, um, Q2 the summer.
Simon Adell:
And then Q3 was really strong. Like really strong, as you could see in Q4 was, was strong. Like, you know, it was good. This is relative to plan on an actual basis. Like of course, bigger than Q3, et cetera. Um, and in Q3 we made the decision since, you know, we were turning ahead of plan. We made the decision that we paid everybody for the missed pay, right. So we paid, everybody who had taken a salary cut. Well, which was everybody, they got a lump sum amount and we did it at the end of September. And, um, and everybody who’d been on furlough, well, they’d already been brought back, but we actually paid them for all of the time that they were out on work. And you know, that like, that felt great obviously, and everybody was happy and I just feel extremely fortunate to a be working somewhere where I was able to work and work safely from home.
Simon Adell:
You know, again, I, I, I, I feel incredibly grateful for the people who are out there on the front lines, you know, putting their health at risk much more than I ever was of course. And, uh, incredibly fortunate and incredibly fortunate to work somewhere where we had the financial wherewithal to treat people at TripleLift. So well, paid everybody, like I said, for all the, all of the money that had been forgone. And it, you know, it ended up being a solid year from a, from a headcount perspective though. So, you know, things did, excuse me, we’d always just grown, grown, grown. Where’s my head count one here. So this is only 2018, as I said, we were like 60 people when I started. But you know, up, up, up, up, up, up, up, and it was just always looked like this and then all of a sudden, boom, right. And then we recovered most of the way by the end of the year. And now we’re back in full growth mode for 2021 is our plan. But we did the first time in TripleLift’s history of this downward.
Mark Eckerle:
So, so as of your end, you’re, you’re pretty much back to where you are pre pandemic, sorry. In terms of headcount?
Simon Adell:
Uh, yeah, that that’s right. But we plant almost a hundred people more by now. Right? Our 2020 plan was very aggressive growth. Yeah. Yeah. Our 2020 plan was 600 million and we ended up getting to about 555. So we didn’t quite get all the way back to our original plan, but I mean, all things considered, boy, we’ll take it.
Mark Eckerle:
Yeah. Still very successful year. Uh, given what has happened tonight, I will give you and TripleLift a bunch of credit for that, for that catch-up that true up in fees and pay that. I’m sure that went a very long way and made a lot of people happy. So, um, definitely some credit goes there. Um, especially because, I mean, th th those two months there were two and a half months from, from March to end of may were very scary for a lot of folks.
Simon Adell:
Yeah. We lost a ton of money in those months. Lost a ton of money, but yeah,
Mark Eckerle:
Like you said, just constantly checking your, your spend and making sure every day, you’re just staying on top of incoming and outgoing funds. But one thing I wanted to touch on that you spoke about earlier was the short-term leases. So very, very great point in, in kind of noticing that you’re expecting somewhat of a downturn and, and maintaining those short-term leases. Um, but what does that look like now? Um, how has the company,
Simon Adell:
It looks like no offices now, no office space, everybody at home, we still have one left. That one that I mentioned was 12 months. So that comes off the books in February. No, nobody we’re just sitting there empty. It’s a co-working space and, uh, in Los Angeles. And other than that, though, like, you know, we’re pocketing all that money at this point, honestly like rent expense. I mean, it’s big, but it’s not, we’re so big now relatively. That’s not like kind of existential to us, to our profitability, but it, but it’s certainly helpful. It’s this, isn’t a weird new world working from home. Me personally, I’ve kind of like done one of these. Like I hated it at first, just hated it. And just not, it’s just not me. I kind of like to be around people and be in the middle of things. Um, but I sort of gotten used to it and you know, we’ve got a rhythm now we’ve done a lot of, a lot of thinking about how to make it as, as optimal as possible for people to give everyone a thousand dollars for like work from home upgrades, to their work set ups and things like that.
Simon Adell:
But it’s much more not, it’s more just a sort of holistic program to try and make people effective. And I kind of like it to be honest now, but you know one of your questions I know is like, what are we going to do? And now, and we don’t know, but what we told everybody is it was going to be a year. So we told everybody you’re not going to be required back in the office until July. We said that last July. So people could plan like for me, like planning school years was important. And so like I left New York. I was in a small two bedroom apartment in New York and that wasn’t going to work with three small kids. So we had some family in New Hampshire. So we moved to New Hampshire for the year. And, um, we’ve told everybody that you’ll be expected back in your office no sooner than July and back in the office where you originally were assigned to.
Simon Adell:
It’s interesting. People have joined us since the pandemic started. Who’ve never been in an office, at TripleLift, like we’ve told them the same thing. Like you may be required to go into an office, but you know, this is some delicate territory right now. Like we don’t know exactly when we don’t know what the office is going to look like. We don’t know where it’s going to be other than, you know, the same cities we were in before. So a lot of questions still up in the air, and this is a major issue for people, as you can imagine. Right? Like trying to organize my life here, help me out.
Mark Eckerle:
How’s they’re saying w we’re exactly we’re in a similar boat, as I think a lot of companies are. It’s like, there’s that tentative due back date what we’re expecting things to be quote unquote, back to normal and we’ll be back in the office. Um, whether that’s a full-time or a hybrid model, we, we don’t know. We’ll wait and see. Um, but one thing that is kind of pressing, I mean, we’ve been in this stage now for roughly nine months. Um, what is your gauge on the mental health of employees, right? Are you doing daily video calls or how are you checking in, I mean, 300 plus employees. There’s a lot to keep track of there. What do you think has worked for you guys to transition to this full remote model?
Simon Adell:
Right. So, you know, first of all, it’s not really my area. We’re so big. Now we have like a really big well-functioning human resources team, and they’ve kind of taken the lead on this, along with our CEO. And, uh, but you know, we always did a weekly, we call it a chat and choose like an all hands at lunchtime and that’s continued and, you know, I’ve, I have a daily standup with the accounting team and another one-on-ones with everybody else in the various parts of my team. And it’s, there’s, there’s no magic bullet here. Right. But, uh, um, communication over communication, empathy, all of those things. But the definitely, you know, a lot of face-to-face zoom calls, not this WebEx where I can’t hide my messy background, get my, get my gray hair touched up. So
Mark Eckerle:
Looking ahead now, right. We, we, we looked at
Simon Adell:
Sorry, one last point in that. So we, we definitely been flexible about like work from home situations. Right. And I told my people in like early on, like, and I didn’t realize this, but this actually wasn’t a message that I don’t think every team at TripleLift was, was passing along, which was like, you should take time out during the day to do stuff. Right. Like, cause there’s definitely a inclination to just like stay and work like the whole time. Especially if you don’t have kids just like, I don’t know, I’m at my computer. There’s nothing else to do. Like just work, work, work, work, work. Cause then I always told everybody like go out in the middle of the day, like whatever, like, you don’t need to check with me, like fit it into your schedule, and like don’t ask right. Block it off on your calendar and that sort of thing. And I, I absolutely did the same thing for me. It was like a nap walk with our newborn and a stroller every day from two to three. And so, you know, you have to sort of do things like that. Otherwise just sitting at the same place. I laugh now, sometimes I say to my wife, I’m like, did I get my 10,000 steps in today when I’ve gotten like 50 steps in, you know, I’ve gone like no where it’s pathetic. So
Mark Eckerle:
Sitting at the desk all day, it’s tough. I mean, especially for those that don’t have children, you can just work, work, work, work, work. If you’re in that.
Simon Adell:
No, it’s worse to have kids. If you don’t have kids, you’ve got no excuse not to go ahead and get some exercise, but
Mark Eckerle:
Yeah. But that’s, that’s my point is like, you don’t even think about it, but have families, it kind of forces you to do other things. Um, which makes it harder. I mean, trying to juggle work kids at home, the school at home, it’s, it’s a tough environment for a lot of folks.
Simon Adell:
It’s been tough. It’s not, it’s not my cup of tea. That’s for sure. Yep.
Mark Eckerle:
So, so looking at 20, 2021 and, um, I guess even in the partially 2022, what are your goals? I mean, we looked at the operations and how you, you projected 600 million for 2020. Um, you’re kind of just under that given pandemic, which is still, I think, widely successful, uh, almost breaking even for that, for that part, but what is,
Simon Adell:
We were profitable last year we were profitable because we made it most of the way back to our plan. And remember, like we didn’t grow, we ended up with the same head count that we started with. So, and we had, we didn’t have a lot of expenses that may or may not come back travel and entertainment is big in this industry. Right. That, that didn’t happen. We did less marketing. A lot of, there was just a lot less expense. So it was actually ended up being a very profitable year for us, just sort of backed into it that way. Um, so yeah, we, we had a good year.
Mark Eckerle:
What does that look like for the, for the current year? I mean, are you projecting similar numbers as prior year? Are you projecting increases? I mean, we’re still in this pandemic
Simon Adell:
We only ever project huge increases and we only ever hit them. So it’s the same this year. I won’t reveal what the exact time you, it,
Mark Eckerle:
Yeah, I wasn’t asking for specifics, but I’m just wondering
Simon Adell:
It’s much, much bigger than, than last year, much bigger.
Mark Eckerle:
So you’re, you’re taking the, um, figures from, I guess, Q3 and Q4 is kind of your tailwind, into the new year. That’s, you know,
Simon Adell:
A lot of thought went into it. I mean, there’s, it’s a complicated, you know, at the scale that we’re at, it’s complicated to forecast numbers, but we, a lot of inputs including Q3 and Q4 actuals and uh, just momentum and traction with individual customers and our top 300 brands and our top a hundred publishers, et cetera, et cetera. So a lot goes into it and yeah, it’s going to be, and you know, we’re only 12 days in now, but we’re exceeding plan so far. So I’m, I’m thrilled.
Mark Eckerle:
There we go. Starting the year hot. So a couple more, couple more questions before we wrap this up. Um, I did want to ask outside last year, right. Where we had the significant hurdle first time in, I don’t even know last a hundred years or so. What, what other hurdles have you come across during your time here at TripleLift? Um, so the last five or six years, what, what have you come across? How did you kind of attack those and what methods did you find best, um, that you think our listeners would be curious to know about? Because they may be facing those same challenges now.
Simon Adell:
Yeah, so I’ll, I’ll flip that a little because at TripleLift, so I’ve been here a little over five years now and it’s been a strangely charmed existence. I mean, we went through that pandemic and even that somehow we came out, you know, pretty well. And it’s just been up and to the right, as we say in finance the whole time here. And so we haven’t really, I personally haven’t dealt with anything like major challenges. And I think the reason I didn’t is because we adhere to some really key principles that I will say that I’ll pass along with. One of your questions was like, what would you advise people or whatever in a startup. So if you do these things, they will help and they’ve helped TripleLift be successful. So I haven’t had to deal with some of these major problems. And then I would say that like one is kind of a cliche, but it’s true.
Simon Adell:
And it’s like pick big markets, which is like, like everybody says that it’s like pick the big market opportunities. And like, that sounds like trite. And like, of course you want to, but other than when I worked in energy, this is the first time where I was like, Oh wow, like this is a really big market. Like there’s, you know, there’s over a hundred billion dollars of digital ad spend in North America every year. Now the majority of that goes to Google and Facebook, hopefully not forever, but right now, but that still leaves tens of billions for the rest of the market. It’s just a big market. And so there’s just a ton of opportunity and you kind of, there’s just a lot of opportunity and there’s a lot of different ways you can go. And so that’s kind of like good. So when you’re I look back now and, uh, I worked my first CFO job, I just, it was a great company and a great founding team.
Simon Adell:
And like, I think we were just too narrowly focused. And I think if we’d been like much broader focus, like rather than trying to solve like one specific FinTech problem that just try to find big market opportunities when you’re, when you’re dreaming up your plan. Number one, uh, number two, because there’s just a lot more room to make mistakes when there’s a big market. Uh, and by the way, what TripleLift does right now is not what the founders originally started doing. This is like a shoulder market. It took them a couple of years to really like hone in to this point of what I’m talking about. Um, and then number two, like, um, well, TripleLift is, is, is fortunate because our founders had the wisdom to battle two big macro trends, which are one are native ad formats. And number two is programmatic taking over the world when they founded the company, programmatic was less than 10%. That way of transacting, these, these ads, you know, via auction that I described, it was less than 10% of the market. And now it’s 90%. So, you know, get on those big tailwinds, make smart bets like that, like that will help. But
Mark Eckerle:
When was that? 10% would that was that when triple, if this started like 2014,
Simon Adell:
2014, yeah. And now it’s 90% of a pie that’s being growing bigger and bigger. And then, but some things that I would say that like any company will apply to any company. I had like three rules. I always tell people and one of them, I’m not so sure anymore about let’s get to the one or not. I’m not so sure about anymore. Just like founders show up executives, show up, show your faces. Like as soon as you start being successful, it’s going to be all kinds of demands on your time. You’re going to be asked to be on boards and nonprofits and do all kinds of things. And those are, those are great things usually. Right? And it’s good. Like, but every time you’re not in, you know, either you’re not involved, like the decision-making process potentially will grind to a halt. And that will cause problems when people will notice that you’re not as engaged and they will be not as engaged.
Simon Adell:
Now this is, I don’t know if that’s even the case anymore now where like all at home, like guys just I always tell people like, you need to come into the office. Like all you like founders and other executives, like you need to be here and show an example. I’m not so sure about that one anymore. Maybe I was wrong all along. Um, but you do still need to be engaged as soon as you’re not engaged, your people are going to feel it. And like, why are they going to be engaged if you’re not a hundred percent there? Um, number two is be decisive, whatever you do be decisive. Like most companies just are not decisive and at TripleLift we’re so decisive, like I give know the credit for that goes to our founders. First time founders. I don’t know how they do it, but they’re so decisive.
Simon Adell:
And like we every year, like make sort of existential decisions about where we think things are going in the industry and we place our bets on that, up into cannibalizing, existing lines of business. Like that’s part of the plan. Like you read that, you’re supposed to do that as business will you, you should do it. And if you make smart bets and you execute on them, like you’ll be, you’ll be rewarded, especially in a big marketplace. So, but be decisive. And that is the number one reason why we were so successful in getting through this pandemic. We were so decisive. We were so engaged as an executive team. And so decisive. It was great. Like we, it was textbook how we responded to this crisis and it’s easy not to, it’s easy to have like senior leadership kind of go into a bunker and you don’t hear too much from them or you’re not communicating enough.
Simon Adell:
And so be decisive, whatever it is you do, not just in an emergent, a crisis, be decisive. Don’t like, let bad bets linger, move on, et cetera. And then the last one is like a personnel HR type thing, which is there’s two ways they’re going to sound a little like Machiavellian. And that there are two ways to get ahead. I’ve noticed in the world. And one is to be like supportive in the professional world, one is to be like supportive and try to make people around you like better. I’m trying to help them do better at their jobs and help the company. And the other one is to like backstab people and try to like, look better yourself by making other people look worse and you’d be like, well, everyone will be like, well I want the first one. Right? Like that’s obviously the better way.
Simon Adell:
Yes, it is the better way. But the second way of like making other people look bad is can be super effective. In fact, I think it’s like probably more effective, like at least in the short term, like, so, and it will come and TripleLift like had a great culture, we always had a great culture and I didn’t see any of that for the longest time. And I used to tell people, I’d be like, when the CEO I’d say like, this will come, like we’ve lived this charmed existence where it’s, it hasn’t happened yet, but it will. And when it does, we need to not allow it to fester. And you know, because if we allow it, then it will propagate because people will see that that’s the way you get ahead at TripleLift. Right. Like I could whisper in my boss’ ear and say that guy over there, like, I just don’t know about them.
Simon Adell:
And like, in a way that kind of like, I’ll be like his work product. It just wasn’t great. Like kind of makes me seem kind of smart, doesn’t it? Right. Like, and so like, like, wow, like yeah, the wrong CEO who doesn’t take that, right. He’s like, wow, that guy Simon knows what he’s talking about. Like he knows even about another area. That’s not him or his area or whatever it is. Right. Like, and you know, that kind of like a political maneuvering versus like me and go and talk to that person like quietly one-on-one to be like, Hey, what about this? Or, you know, find ways to help that person be successful in his, in his or her role. So you want people who do that. And by the way, like I think human nature is more like the second way. Kind of like gospel of people and put people that like, I have to catch myself doing it.
Simon Adell:
I’m like, no, no, no. I want to be first person. I want to be that supportive person who just focuses on the positives and tries to put people on my team, at least in positions to be successful rather than fail. And around the whole company, I want the company to be successful. And I want to do that by helping people be successful. But you have to guard against that second persona and you cannot allow it to happen once, once it propagates, like it will be everywhere in your organization and you’re just going to be a mediocre organization at best.
Mark Eckerle:
Yeah. And it’s, I think that’s part of almost human nature to go that second route. So it’s, it’s nice that you said where you at. Right.
Simon Adell:
I have to force myself to be that first type of person.
Mark Eckerle:
It’s definitely not easy. Yeah. It’s it’s
Simon Adell:
I do it it. I do it. It’s like a conscious discipline. And don’t allow as a founder, do not allow that second type of behavior to, to, to even, to, even to exist within your organization, let alone be rewarded
Mark Eckerle:
A hundred percent. I totally agree. And I mean, you really hit the nail on the head to all. So my last question is always what tips or tricks you gave in those three tips? Right? They’re all fantastic. Um, for not just founders or executives for anyone bottom, top to bottom, it’s important to remember that all throughout your career,
Simon Adell:
Be decisive show up and be engaged and be the person who makes everybody better. Okay.
Mark Eckerle:
Exactly. Exactly. Well, I think that pretty much just wraps up today’s episode. Um, thank you, Simon for joining me. Um, where can, where can people go to learn more about the company or yourself? Is it triple lift.com?
Simon Adell:
Yeah. Yeah. If you’re not an industry, that’s going to be complicated. I invite anybody to email me, email me questions. Uh, I’m active in the New York tech, CFO, uh, group, and I’m at Simon, at triple lift.com. And, and thanks to you guys. Withum has been a great partner. I didn’t know Withum before I joined triple lift. And it was recommended to us, to me by our, that as was financing that was running finance when I arrived and it’s been the best, one of the best decisions I made since I joined TripleLift, it’s shout out to Melissa and her team. You guys have been fantastic getting us through to where we are now. It’s really been a wild ride. So thank you.
Mark Eckerle:
Yeah, of course. Awesome. Well, thanks again. And, uh, we will see you on the next episode of founded in tech.
Thanks everybody. Take care. Thank you for tuning in. If you liked it, want to hear more, you could follow us and subscribe and we’ll see you next time on founded in tech.
