How Brandzooka CEO Aquiles Lagrave grew Brandzooka to $2.9M revenue and 50K customers in 2024.

hello everyone my guest today is achilles legrav he is the founder and product leader at brand zuka he develops and scales web services that disrupt and delight in addition to building teams that create and create the space for people to deliver extraordinary results and develop product market fit he writes for publications like ad age dow jones and speaks regularly on subjects ranging from entrepreneurship and ad tech to agile and product development practices for organizations such as stanford and ido all right achilles are you ready to take us to the top absolutely all right so tell me more about brand zucca and also the revenue model is it is an agency or a sas model uh yeah so uh bransouka is a video advertising platform that is for the first time unlocking the crown jewel of advertising and that is the tv screen so we basically marry digital advertising with tv making it possible to run ads in the same way that you would expect to from google in a very targeted way uh and then delivering those ads on primetime tv which we think it's uh uh it's pretty cool okay so hold on hold on hold on so the obvious question right which i'm sure you have an answer for is okay you saw that i visited travelocity on my computer you know i have an upcoming trip to tulum mexico when i'm watching the voice tonight on abc how do you put a tulum ad on my tv is it cookie tracking what's the tracking uh well so in terms of tracking technology um we leverage over 20 dmps these are data management platforms so there are giant companies think of the nsa except not not government funded whose entire job is to keep track of behavioral segments online these are companies like uh oracle datalogics that also help fuel targeting on facebook we're able to uh access all of that data why that seems like a big deal how are you able to access it all uh well dmps actually are marketplaces that sell that data it's gotten programmatic platforms uh and dsps such as principa or the trade desk for example but why isn't abc again i'm using the voice as an example here and i forget what channel it's on but doesn't abc if the voice on abc have its own sales and they're putting the geico commercial there on the other one there how do you override that yeah so let's talk about actually the higher level story here which is really interesting we are living through the largest media transition in history sorry i want to go high level but i want to understand the the detail first what is it that people listening right now how should they think about actually experiencing the tech that you're providing well the way you experience it is by going to bransuica.com it's a free to access platform so you can actually access it with a click sorry i mean if an advertiser is trying to reach them using your tech right so if they're watching the voice tonight on abc you they see a geico commercial and then after that a hot dog commercial and something else you're saying your tech is the biggest breakthrough hasn't happened before you can override essentially those commercials somehow and turn that tv ad space in no no no we're not overwriting anything so there is this huge transition from linear tv to what's called ott over the top tv we're all experiencing this by accessing services such as sling hulu the tv apps on on roku on apple tv on fire tv etc that is a whole different channel that is a digitally fed channel rather than your traditional um linear got it you're playing on those ott channels not the linear stuff that's exactly right got it so when that happens those commercials that you're seeing over ott happen over the programmatic spectrum so unless you're in media or in advertising programmatic might be a new term for you programmatic is basically the marketplace that fuels the buyer seller relationships in advertising we're very used to this on web so when you load a uh when you load cnn.com the ads that you get served are different than the ads that i get served right because they're targeted in a different way we're carrying that thesis and that technology over to the tv screen and what do you do that's unique from everyone else why can't everyone just go buy access from these data players and do the same thing you're doing um so to this point this space has been serviced by enterprise dsps such as rocket fuel app nexus and the trade disc these guys build very high-end pieces pieces of software that allow professional media buyers at large media agencies to transact media in this way no one had gone out and made a self-service platform that literally allowed a coffee shop for five dollars a day to do the same i see so that that is spring suited so you would say the big difference is they're going after the kind of the big enterprise folks they have a big inside sales team you're going after the long tail which is much bigger but it has to be a no touch sale that's exactly right so what we find is um you know when you go out to a large agency like starcom unless you have a quarterly spend that's literally in the millions of dollars there's nothing those media agencies can do for you yeah because we end up seeing very large brands and it's very repetitive uh bransoka gives you a cell service model that allows anybody to in a couple of minutes launch a primetime tv campaign over programmatic um and then or um or internal machine learning and algorithms allow those media buyers to significantly outperform what humans are at agencies are able to uh to achieve got it okay makes good sense i get the product now um tell me more about the business so how are you making money is is it a cut of spend through your platform is it a sas play what's the revenue model yeah so you know uh we uh we spent a lot a lot of time looking as to the positioning of uh of the uh platform from a revenue generation standpoint and what we found is a lot of people have tried to provide self-service advertising platforms for folks and they generally have gotten it wrong you can't monetize the long tail through subscriptions you can't monetize the long tail through flat fees it just does not um it does it does not set the right relationship with the end user and what the end user is trying to achieve which is performance so at bransuica we take an approach that should be readily similar to uh to what folks experience on facebook or adwords it's again a completely free platform to uh to access and use and we monetize off of the targeting features that you engage in the platform so if you go in and you decide to launch a campaign that is targeted very broadly let's say you want to target anyone in in the universe there's no value-added uh features that we are um that we're engaging for that campaign and so for that campaign brand success monetization would be zero dollars if instead as you're creating an audience you decide that you want to find folks who are in the market to buy a house in a specific zip code and have x amount of income as you refine that audience and you engage those targeting features and we start engaging our targeting algorithm to deliver your ad to that specific pool segment then you start seeing uh our monetization go up through our uh targeting charges yeah but just to be clear you have to pay sling and the ott guys some amount on that like how do you how do you win that inventory over all the other guys with the same inventory oh that's a fantastic question so then at that point you're talking about what are the the market dynamics um that allow a yoga teacher to be gm well yeah i want to specifically figure out though where you have to be taking by the way rubber is not a bad thing i just want you to tell me where you're getting the revenue from so if the yoga teacher let's use the real estate example actually what you just talked the real estate agent a specific zip code let's say i'm making this up they pay a hundred bucks uh to run i don't know what that would get you one ad and one market very targeted walk me through where that 100 bucks goes yeah so that 100 bucks is distributed into two costs media cost and that's what it takes right to get the adam sling that is what i pay sling to get that ad on tv right the other cost center well which is what typically which is what typically on a hundred bucks let's say it's 100 of the spend what percent typically so so sling will charge you on a cpm basis right so on a per impression on average uh you're looking at about a penny okay right yep so so to actually serve that inventory you're paying a penny uh to sling depending on how refined or how broad right that hundred dollars will be split also into targeting costs and then what's your markup you have to make money here the targeting cost is the value that branzuka is providing it's our monetization yeah again so achilles if i put 100 bucks through your platform brandzooka.com you'll say okay 80 bucks of that's going to go to sling 20 bucks worth keeping that's our targeting charges what i'm trying to figure out what margin are you taking well it would be that 20. oh you're taking 20 percent i guessed it right yes oh okay i didn't know that you didn't say that no no no but it's not a flat fee right it's 20 percent of whatever it's 20 of whatever spend you put through the platform no it is whatever the percentage of your targeting costs come out so if you apply no targeting if you apply no targeting there's no monetization for branzuka if you apply every bill and whistle to to hyper target an audience that can be 20 30 in targeting cost okay got it so so it's a...