Andrew: Hey there, freedom fighters. My name is Andrew Warner. I’m the founder of Mixergy where I interview entrepreneurs about how they built their businesses, and I do it for an audience of real entrepreneurs. And I know they’re real entrepreneurs because, boy, I keep hearing about their successes via email, via tweets, via, frankly, scotch night at the office.
And joining me today is a guy who’s built an already successful company, lots of traffic, lots of businesses using it, and still I never heard of it, and I couldn’t figure it out with all the research that I had at my disposal before the interview started, and I’m starting to get it.
Here’s the idea, and Shaul Olmert is the founder’s name of Playbuzz. Shaul, tell me if I’m understanding this right. The old idea of just publishing straight up text on a website is okay. It’s still alive and well. But quizzes and other content that are more engaging do well online because you take a quiz about like, “What kind of car would I want to drive?” and then after I’m done taking that quiz and I want to share with my wife, and then if it’s kind of a funny response, I might share it with my brother and say, “Hey, Michael, you always said that I was a bit anal. Turns out I need to drive an anal car.” Right? And so it’s more engaging, and it’s also more viral. Am I right? That’s the content that you guys create.
Shaul: So, Andrew, first of all, thanks for having me. And it’s great to hear that despite our genuine marketing efforts, we haven’t quite been able to tell the story in a way that’s easy to digest, but I get that. I think that the world is changing and changing very fast, and with it, we as people are changing. And today, we don’t have the attention span and the patience we used to have years ago. We’re no longer reading long articles. In fact, statistics show that an average online article is consumed for an average of 8 to 15 seconds, meaning that all of us are no longer pay attention to long text.
But when content is interactive, is visual, is engaging, it’s done in a more interactive and most fun way, people would actually pay more attention, and when they do, they actually get more out of it. They actually learn something from that content. They actually relate to it. They actually share it with other people. If it’s a commercial content, then they learn more about the brand or the product that is being advertised and have much higher brand awareness. So Playbuzz is a platform that is enabling, is powering both publishers as well as many brands to create editorial and commercial content that is more engaging and more fun.
Andrew: Okay. And what you’re doing it is you’re allowing a company like Ford to create one of these quizzes like the type that I took in preparation for this interview, but also consumers can go, or I guess not consumers, but regular people can go to your website and publish a quiz or take a quiz and share it with their friends. That’s the idea here, right?
Shaul: So we’d like to think of ourselves as a platform similar to, let’s say, YouTube, for instance. YouTube can be used by an end user for just their own fun, family-related content. or it can be used by an enterprise in order to create a multi-million-dollar campaign. Same with Playbuzz. Our toolset is opened to everyone. It’s being used by millions of individual users who create content for their own fun as well as by a lot of Fortune 500 brands, like Ford that you mentioned, Unilever, Netflix, Coca-Cola company and many other advertisers, as well as many publishers like MTV, Huffington Post, ESPN and many other leading news and information organizations.
Andrew: All right. I should say, by the way, this interview is sponsored by two companies that I’ll talk about more later. The first is HostGator for hosting websites. The second is . . . What’s the second? Regus. Regus for hosting people, offices. I’ve been using Regus office for years.
Okay. Let’s talk dollars and cents. How much revenue are you guys producing right now?
Shaul: If you ask me, nearly enough. Obviously, as a private company, we’re not public about our exact revenue figures, but it’s in the tens of millions of dollars, and it’s growing nicely.
Andrew: Tens of millions of dollars, and then traffic to your website – 11 million users July, 2018. Does that sound right? That’s what I’m seeing from SimilarWeb.
Shaul: If you’re talking about the traffic to playbuzz.com, then we have a couple of dozen so far, millions of users every month on playbuzz.com. But playbuzz.com is not really the majority of our business. The majority of our business is being done by the publishers I mentioned, like ESPN and MTV and Sky and many others as well as the advertisers that [use us 00:04:41]. We interact throughout our network with about half a billion users every month, so it’s quite sizable.
Andrew: But here’s what I don’t understand. The brands you talked about are pretty sophisticated companies. Can’t they just create their own quiz software? They need to use you guys?
Shaul: It’s a great question. First of all, beyond quiz, quiz is one very popular form of interactive content. We have many others as well. And the answer is that even though when it comes to media companies or to advertisers, they’re not technology companies. They use other people’s tools. They’re not going to recreate the wheel for everything they want to create. They rely on people like in this case Playbuzz. That is our whole business.
We’ve been researching user behavior for years now. We’ve been learning and working with all of those big brands and all of those big publishers and interacting with until now in history we interacted with more than four billion different individuals around the world. So we’ve learned quite a lot about the way people consume content, about how to turn content marketing into an effective impact for . . .
Andrew: And it’s your software that learned it, or it’s your team that knows how to create the right content that will spread and get people to use it?
Shaul: So we don’t really create content. We’re just creating the software tools that are being used by content creators. So we’re talking about, when ESPN wants to convey, wants to create a great story for their audience and they want it to be really meaningful and impactful, they use Playbuzz because the kind of engagement metrics they can generate with our tools is significantly higher than just a regular [article 00:06:18].
Andrew: Give me a specific. What specifically are they getting from you that makes it better than a homegrown software? What have you learned that’s now being baked into the software?
Shaul: So first of all, our software allows them, allows their creators, their authors to access our system and create interactive article, not just the regular text, images, headlines, which are really the same building blocks of the traditional article as it was invented 500 years ago and hasn’t evolved much since, but more question and answers and conversation like dynamics and clickable images. And a lot of different elements in the page that just make the article so much more engaging. And as a result, if I mentioned that the average editorial article is being consumed for 8 to 15 seconds. On average, Playbuzz articles are consumed I think between one and a half to two and a half minutes.
So just to give you a sense of like how much more engaging, how much more effective form of content creation is on the editorial side as well as on the commercial side. I mean, if you’d look at just a regular banner ad or a regular [inaudible 00:07:28] video, everybody either blocks it by using an ad blocker or skips it if there’s a skip button. And generally speaking, usually when I meet ad agencies and I ask them, “How many of you have ever clicked on a mobile ad?” and nobody is raising their hands because we all know it’s a very . . .
Andrew: I can tell you though, I’ve never taken a quiz online. I did take one in preparation for this interview. I kind of get it. But I don’t know that any of us are the typical consumer. But what you’re saying makes total sense. We are not spending a lot of time on articles. It’s not as engaging, and we’re not sharing articles the same way that we might share something about ourselves. So you’re doing way better than I imagined. I had no idea you guys were this successful.
Let me say something. You’re kind of liking me right now. We’ve had a good rapport. This might make me seem like a like a jerk. But we were supposed to do this interview a couple of months ago. You were at your house. I was looking over your shoulder. That does not look like a rich man’s house. It’s just an apartment. I think it might have been a hole in the wall behind you. Am I right?
Shaul: Wow. That’s note to self. I should pay more attention to the surroundings when I actually take a video interview. No. I wouldn’t say we’re . . . I don’t want to talk about my own financials, but in terms of how the company is doing and everything else, we are everything but poor. We’re obviously doing pretty well financially. I mean, beyond the fact that we raised $66 million from investors like Disney and Saban Ventures and others. We also, as I said, we are generating significant revenue.
Andrew: Revenue. Did you take any of the money? Did you take any money off the table in one of the raises?
Shaul: Yeah, I’m doing pretty well financially, but I wouldn’t turn this into the topic of our discussion. I will say that we are as a company just the culture is still very startup-ish in the sense that all of us . . . none of us have our own isolated offices. We all work in an open space. We all fly coach. We never fly business class. We still operate much like I wouldn’t say like a bootstrap company, but very much like an early-stage company despite the massive growth and everything else because we just believe that it’s better for the culture. We are all very much focused on continuing to grow and make it a success and not about celebrating and enjoying the fruits of the success [inaudible 00:09:43]
Andrew: All right. Here’s another personal question. Then I promise I’m going to get back into business. But . . .
Andrew: Usually when I find out about someone’s parents, they don’t want me to talk about it, or I feel awkward bring it up. You’re comfortable saying that your dad was the Prime Minister of Israel, not just in my research, but you’ve said it before. Tell me about that.
Shaul: So, as you correctly stated, my father served the Israeli Parliament for more than I think about 40 years. More than 40 years as a cabinet minister and eventually as Prime Minister, which is sort of highest rank of Israeli government official. I don’t really talk about it that much because it’s like . . . I don’t think that he talks about . . . Well, no, actually, he does. He loves to talk about what I do, but maybe it’s a parent thing. But yeah, it’s obviously something that I’m very proud of my dad and everything he achieved, but it always seems kind of removed from . . . We lived very different lifestyles. We operated in very different domains career-wise. So I always find his work and his career with everything that he’s done very fascinating but very much removed from what I do. So, actually, it’s not something that I would typically bring up in an interview or in a conversation, but you’re right, I am being asked about it frequently because apparently people find that interesting.
Andrew: All right. Let’s go into then how you got started in business. You are a guy who worked at MTV Networks. I still have so many personal questions to ask you. Maybe I’ll bring them up later in the conversation, but I don’t want to be the jerk who pries into your personal life. But you worked at MTV Networks, and you told our producer, “I was a good corporate soldier. I was a guy who did his job, but there was a midlife crisis that I had.”
Andrew: When you are a good corporate soldier, give me an example of what you did before we get into the midlife crisis.
Shaul: Sure. So I managed a handful of businesses for MTV, and MTV was a great schooling experience for me. I mean, first of all, it’s a really cool company, and it still is and definitely used to be much more 15 years ago or so when I started working there. It was really a big company. It was like take, I don’t know, Snapchat, Instagram and everything else combined. That was how big and cool MTV was and still is to me. So it was a great experience, great exposure.
I mean, I became acquainted very closely, worked with all the major players in the industry, got involved in a lot of different initiatives. Some of them were very successful, some of them not so, but all of them were very entertaining and very educating. And I really loved it. I didn’t think of myself as an entrepreneur. I’m not one of those Mark Zuckerberg kids that couldn’t get along in college because they couldn’t take dictation from anyone that they had to drop out and start their own thing. Entrepreneurship came in a rather late or at a later stage in my life. I started Playbuzz. It’s the first company I’m starting when I was 37 years old.
Andrew: Because of the midlife crisis. So what was the midlife crisis that lead you to this?
Shaul: I call it midlife crisis, but essentially, I get to the point where I felt that I wasn’t sure . . . I was sure that I want to do something, and I wasn’t sure what. So I started a journey of a couple of years that may sound familiar . . .
Andrew: You told our producer . . . I love, by the way, that we have producers because they’re not recording anything. It’s just kind of casual conversation, so you could get a little open with them. You said, “I lost confidence in my abilities.” What did you lost confidence in?
Shaul: Actually, I love talking about that because I feel like it’s a . . . I want to be very open about it. Life isn’t always as perfect as they see from the outside. My life definitely weren’t or definitely aren’t. But I got to the point where I was pretty . . . I felt like I was really pretty successful in my early career, my time at MTV and other places. I did well, and my superiors were happy with my performance. I got promoted. But I got to the point where I made a couple of questionable career choices. I joined a couple of companies and only to terminate those positions pretty quickly.
I started getting involved in a few things that I wasn’t very successful with. Then suddenly I lost confidence. Suddenly, I was like, “Maybe I’m not the hotshot that I thought I was, and maybe I’m not capable of doing all the things that I hoped and fantasized that I do.” And it kind of got started an introspective journey, which was very meaningful for me to ask, “What is it that I really want to do, not what would make . . . ”
Andrew: Was this like GameGround?
Shaul: ” . . . me successfully, but what do I really enjoy?”
Andrew: Sorry to interrupt, but are we talking about GameGround which you founded or Conduit where you were the CMO, or are you talking about something else?
Shaul: Yes. So I was on the board of a couple of companies like GameGround and others, and I wasn’t really working full time there. So I was kind of like involved, but not really too engaged and too immersed. And then I started this gig with Conduit, which was a big successful company, and six months later I find myself out of Conduit. Obviously, that was not a smart career move for me or a big success.
And when I looked at all of those things and asked myself, “What is it that I’ve done wrong? Why wasn’t I successful?” My conclusion was that I didn’t really follow my heart. I kind of, like, followed what seemed to me like something that would be well perceived. I was more driven by coming to my parents or to my friends or to my wife and say, “Hey, I got this cool job, and I’m the Chief something Officer of this big company.” And everything else, and I wasn’t really asking myself, “Do I really believe in this company? Do I really like the people? Do I really feel the mission of what this company is trying to do?”
And that drove me to say, “Hey, I don’t want to fail again by following somebody else’s fantasies. I want to follow my own. And if that leads me to success, great. If it doesn’t, that’s okay too, but at least I’ll follow my heart.” And it’s a pretty tough question to ask yourself, “What is it that you really want?”
Andrew: When you say, “And if it doesn’t, that’s okay, at least I felt my heart.” You’re a dad. I also saw two kids in the background last time. I keep looking up.
Shaul: It’s three, actually, yeah.
Andrew: How many? Three?
Andrew: Okay. So you have three kids.
Andrew: It’s hard to say, “Look, my dad was a well-known prime minister. I have kids. If things don’t work out and I don’t live up to his greatness, who cares? If I have these three kids.” And it’s hard, right?
Shaul: No. And very frankly . . .
Andrew: Why were you willing to do that?
Shaul: You’re touching the hardest, the toughest part of it. I think I was always a very ambitious kid. I always wanted to do well. I always wanted to be successful. And it kind of worked for me for a few years, and then it stopped working for me. And then I was like, “You know what? Maybe I should focus my inspiration on doing something which I really like because that’s going to make me happier.” And I was really able to disconnect from perception and what’s perceived as sexy or as lucrative or as by up and really focus on asking myself, “What am I really passionate about?”
And I thought that was eventually it led me to do something which may be more successful than I was ever before and accomplish more than I did prior, but I wasn’t pursuing success, and I wasn’t pursuing financial stability or anything else. I was pursuing trying to figure out what is it that I really like, that really turns me on, that I really want to be associated with.
You mentioned my kids, I think that the main thing I asked myself is, “How can I describe what I do to my young children who are not necessarily . . . ” Now they are, but at the time they weren’t really tech aficionados, so they didn’t really understand the in-depth of it, “But how can I explain what I do to them and be really proud of myself and feel like what daddy does is really cool and is really meaningful and is really impactful?” And that’s what drove me. And that journey led me to start Playbuzz.
So I figured that what I’m really interested in is in creating a toolset for other people to express themselves and to create stuff that they feel represent them and they can communicate with other ways. And that was kind of an underlying theme throughout a lot of things that I’ve done in my career at MTV and other places. And I really felt that, “This is what I want to do and this is what I wanted to do best.” I wasn’t asking myself, “What’s going to be the business model? How is this thing ever going to make money?” I was really just very passionate to do something that will resonate with people, that people will be passionate about, and I assume in a very naive way, but I think that this approach proved itself eventually that if people really like it and that I create something that really touches people and really engages them, eventually it’s going to make money as well. And guess what? Fast forward six years into the future it’s kind of what’s happening.
Andrew: But six years ago you told our producer not a single person told you it was a good idea. I want to ask what the first idea was that people didn’t like, why you pursued it anyway, and then what the first version looked like after you pursued it. But first, let me tell people about a company called Regus. Do you know Regus?
Shaul: I do, of course.
Andrew: You do you?
Andrew: Of course. What do you know about Regus?
Shaul: For instance, I travel a lot for business. Our business is very global, and I find myself in different countries and different cities around the world. So more than once, I want to use for different office spaces, and Regus is the provider of office spaces for people on the more flexible level. You don’t actually have to sign a six months lease in order to use the premises. So sometimes I use them, or sometimes I use companies that are residing out of Regus locations around the world.
Andrew: Yeah. I think people don’t recognize it because when you even walk into a Regus office, it doesn’t say in big letters “Regus” because they want it to feel like the personal office of the people who are renting it. So I have a Regus office in San Francisco. You come to my office, 201 Mission Street, you walk through the 12th floor, you come out, and you see two receptionists who are sitting there ready to greet you, ready to offer you water. You don’t see Regus behind them. So if I didn’t tell you, and you weren’t as smart as you are, you wouldn’t know that it’s a Regus office. You just say, “Andrew’s got this really nice like offices. It’s so comfortable.”
And here’s why I got it. Not like to try to impress people, because I don’t work in an environment where you want to impress people with good office space. I did it for myself. A lot of people who are listening who I think would be perfect Regus customers are this. They have a remote team, or they’re working independently, and they are wondering, “Should I move into office space?” And the benefit of moving into office space is everything is exactly the way you need it to work. You’re mentally in an office environment and mentally in a get-ready to work environment because physically you’re in an environment that’s catered to you working.
And so you go in there, you get your work done, you have other people in there, they get to feel like they’re in an elevated space, and you don’t have to manage any of it. You don’t have to pay for the receptionist. You don’t have to pay for coffee. You don’t have to pay to have a refrigerator. You don’t have to have somebody sweep the floors. It’s not your problem. Any issue goes on with the internet, it’s no longer your problem. It’s like the old days of madmen. You go to the secretary or in this case you go to the receptionist and you say, “Listen, the internet’s not working very well.” Great, they fix it.
They gave me instructions on how to add a printer to my computer. I said, “I know this stuff. I’m missing a step.” She didn’t say, “Oh, Andrew, here’s what you have to do.” She said, “I will be right there.” Terrell walked over to my desk, she took over my computer with me watching, and she fixed the printer because she does it a million times, and I was able to print. I print once a year. I don’t need to know this stuff.
Anyone who’s listening to me who needs office space, do it. Don’t even sign up, just go to Regus. I know many people have taken me up on my offer to introduce you to the person that I work with the Regus, do it. Me and my team are here, email@example.com will introduce you, or I really like what Shaul is saying. He’s saying you don’t even have to book yourself in forever. All you have to do is if you need office space, they are there. So get to know Regus by going to regus.com/mixergy. You can have office space like I do on a long-term basis or like Playbuzz does, go in whenever you need it at whatever city you’re in. All you have to do is go to regus.com/mixergy or email me firstname.lastname@example.org. We’ll introduce you to our person at Regus. A really good setup.
All right. Not a single person told you it was a good idea. What were you explaining to them? How did you say it to them?
Shaul: So I think that our vision back then when we started a company is very much similar to how we describe our vision today. We said, “Hey, there are better ways to create content that will be more engaging and more impactful for people. And we’re going to create a platform for the also in the distribution of such content.” At the time, we were focusing mostly on editorial content, not on commercial content like we are today, and we thought of it less of as interactive articles as more as mini-games. So we said, “We’re going to be a platform that enables the easy creation and deployment of mini-games around content that can be integrated into different publishers’ websites.”
And the idea in general when I started describing it to people, nobody told me, “Listen, you’re on to greatness. You should really pursue that. This is amazing. Where do I sign up? How can I join you?” The reactions were mixed. Some people say, “Listen, it’s not a very good idea because of this and that.” Or some people said, “Yeah, I guess it could work. It sounds okay,” but nobody was really encouraging. And I think that since I got to this idea by the self-conviction of like, “This is really what I believe in and this is really what I want to do.” I didn’t let those feedbacks set me back. I tried to listen and learn from them. But I stayed very committed to the idea and to the concept. And eventually, when we started working on it and started making it happen, it got clearer and clearer to people.
Andrew: You know, I’m wondering why they didn’t like that. I’m trying to find an old version of that site to see what it looked like when it was games around content. That makes sense to me, I guess.
Shaul: Yeah. I think at the time . . . Our product evolved a lot with the years. When we started, we were actually creating apps, full-blown apps, and then we realized that apps require a lot of preparation, and it’s actually not that intuitive for publishers to promote content within apps. So for a whole host of reasons, we neglected that and moved to the format of articles and interactive snippets as we do today. So I think the product evolved a lot, and now it’s much more self-explanatory and much represented so much better.
But I also think that the world has evolved. We saw at the time when Tom, my partner and I started a company, we saw something that wasn’t quite there, but we kind of saw it. We felt it’s emerging. And today it’s very evident. Today it’s very noticeable. So in the world that we live in today, this concept resonates much better than it did six or seven years ago when we started.
Andrew: What’s the deal with the 150-page document that you created when you started?
Shaul: So coming from corporate America and having worked in large enterprises before, I got used to working in a very organized manner. So when we just started, for our first product we created a very detailed product specification document that was about 150 pages, and we kept changing it all the time. It included these very detailed scenarios of like how exactly each screen should look like when a user is logged in or when they’re not logged in, and each button that needs to be on the page and everything else.
And this is sort of old school way of product planning, and it was legit at the time, but it’s not very agile, and it’s not very adaptive, and it’s not very suitable for the new type of companies that are working in a very rapid environment, releasing products very, very quickly, and really seeing what works and what doesn’t. And that document represents one of the learnings, one of the great privileges that I had with Playbuzz to learn from younger people who are so much smarter than I am about how to work in a different kind of environment that’s just much more agile and much more spontaneous, and it’s all about testing things and judging them by the data or how people use them, and not by predefined plan of how we assume people would use them once they create.
Andrew: But Shaul, this is not your first tech startup. GameGround was a company that you founded, right? That was a tech startup, wasn’t it?
Shaul: Yes, it was, but at GameGround I thought that one of the conclusions was that I wasn’t really working full time at GameGround. I started a company together with a bunch of other guys, and those guys worked really hard and actually came day to day to the office and striving to make the company happen while I was doing other things. So, to my embarrassment, I can’t take credit for really being in the trenches with them. And I think that that’s one of the things that’s such an amazing experience for me about Playbuzz is the fact that I actually came all in. I decided that this is what I’m doing, and I’m giving it all I got, and I’m all in. So that’s a very different experience than just being sort of a co-founder on paper and an active board member.
Andrew: And then once you said, “It’s not going to have to start with this 150-page document. We need to be more agile.” What did that first version look like? I’ve gone back to the Internet Archive, I can see older versions, but I haven’t seen the first version yet.
Shaul: So I think that first of all, at the time we were only doing quizzes. Now we have a whole gallery of experiences that people can create with Playbuzz, quizzes being one of them, but definitely not the exclusive one. And I think it was a very basic. I mean, since then we’ve developed more [advanced 00:27:07] module, for instance, the ability to harvest a lot of different third-party data through the interactive components and then present them in a report to the content owner. We created a lot of monetization mechanisms that are built into the . . .
Andrew: This is later. Let me just go to the first version because I actually, I think I finally found it as we’re talking based on what we said.
Andrew: The first version looks a lot like BuzzFeed, right? Even the buzz logo that . . . You don’t like that I said that. I noticed in your eyes as soon as I said “A lot like BuzzFeed.” Even though other articles had said it, I noticed that you don’t just like that comparison. Why?
Shaul: BuzzFeed, I’m familiar with the, now in this case . . .
Andrew: You’re familiar with them?
Shaul: No, no, no. So look, basically, I think that the first version was not only closer, we looked to other websites. It wasn’t unique enough. It was very rudimentary. It was very basic. And when you start, you start learning the basic product. I think it’s something that I really tell a lot of entrepreneurs that are encountering and I’m also internally whenever we develop something new, the lesson is really starts on some pretty bare bones. It has to be something very simple. Don’t over-think every details. Just release it. And then start focusing on really what’s important. Start learning how people use it. And when you do, you’re beginning to develop more of an individual identity to it.
So I take your comment that our first version may have looked a little bit generic, may have looked a little bit like other things, but over time, the more it got used and the more we had users’ feedback and the more we could analyze analytics of how people are actually interacting and consuming it, the more we learned how to turned it into something that the unique thing that it is today.
Andrew: Okay. Okay. So, for example, there are bunch of quizzes on that first page. This is my favorite one, “How addicted to Facebook are you?” because I could totally see somebody taking this and then posting it on Facebook to share with their friends, and it give me a sense of how you’re working. And the whole page was full of those types of things. All right. That is more of the consumer side. But you wanted from the beginning to be a B2B play, right? How did you get your . . . Once you got the product, and I could see that it’s working at this stage, 2013 is when I got that screenshot from that I was going through. How did you get your first company to pay you to use this software?
Shaul: So it was very hard battle, and we won it in the most unpredictable way. When the company started, when the . . . Before even the product actually launched, I started pitching it to different publishers around the world. So I traveled to my old friends at MTV and many other big publishers, and I showed them what we’re doing, and I demoed it, and I sang the praises of all the great values that it will create for their business, and nobody really bought in. People had different comments, some liked it more than others, but it never really . . . It didn’t resonate with anyone as a major priority for their business.
And that was a very tough time for me personally, obviously, trying to pitch it around. And then I think that the success came from kind of like left field by us just using our own software to create content and sharing it online. And before you knew it, the content that we created in-house became very popular, and that became the justification for showing how powerful those content formats are.
So we hired one person in-house to create content using Playbuzz so we’ll have better demos. So when next time I pitch to ABC or CBS or ESPN or whatever it is, I’ll have better examples to show. And she created. We hired a very talented content author. She created some great examples. Those examples looked great, but they still didn’t buy in. But then those examples that she created started having life of their own, started getting very viral on the internet. People saw them, people liked them. Some of them came to our website and saw that they can create their own interactive articles and quizzes and everything else and started creating their own.
And then all those publishers that wouldn’t return our phone calls, saw that it all becomes very successful and suddenly they came to us, and they said, “Hey, we want in on your secret sauce,” and we said, “What do you know? We happen to actually have it as a platform that is white labeled. It is completely meant to serve you guys, so why don’t you use it?” So that’s kind of how it came about, and it was a very pleasant . . . I want to take credit and say that we planned it all along, but honestly, we didn’t. It just kind of happened to us, and it was a very happy surprise.
Andrew: Do you remember the first customer?
Shaul: Sure. We had kind of a couple in parallel. The first I would say was the Tribeca Film Festival. We got introduced to them by someone and a young producer that work there thought highly of what we do and decided to use us. So that was one. And then there was one publisher from New York, a website called crushable.com. So there were a couple in parallel at the very early stage, and we would get support calls left and right because the platform was very unstable and very rudimentary, but their feedback also helped us to shape it better.
But really the point of no return, the point in which it became big was that when we started just creating our own samples in-house and distribute them and that’s when everybody started using it, and then I would wake up in the morning one day and look at the analytics report and see that Huffington Post is using our platform or the ESPN or that MTV or that BBC, all those big websites are using us without even us calling them. And then we started actually having a more formal relationship with them and started moving them towards the commercialization of the product and see how they can actually make money using Playbuzz and that’s when it started becoming an actual business and not just a very fun viral part.
Andrew: And on your website . . . First of all, every quiz had, obviously, a link back to your site. It was when they went to your homepage that they realized that they could put this on their site themselves, right?
Shaul: So we are . . . Much like what you described about Regus, we are completely white label. Our goal is not to be a consumer brand. We don’t want people to see our name. We want people to have the best content experience with ESPN or with any of the websites on which they consume our product. So a lot of you guys are consuming a lot of content created with Playbuzz without necessarily knowing it was created with Playbuzz, and it’s completely fine. I think that the majority of our marketing efforts are really focused on the B2B sites. So we are going to trade shows, we are advertising . . .
Andrew: I’m sorry to interrupt. But in the earlier days, it was they saw the quiz on your site, your site would encourage them to make their own quizzes, they would start to use that, and then you said it was . . . First of all, it was free to do what I’m talking about up until this point, right? And then at what point did the monetization come for you and for them?
Shaul: So monetization . . . Our platform is still completely free, and we encourage everyone whether you’re a blogger or a publisher, just content author, go ahead, create great content, and then you can embed it on your own publication, on your own app or a website or whatever it is. No questions asked. It’s all for you. Some people are doing it not only to create great content, but they also want to monetize, and that’s when we started creating monetization programs by either inserting ads into the content and sharing revenues with the author or the publisher partner or by creating commercial content. So, essentially . . .
Andrew: By the way, that’s your phone . . .
Shaul: Yeah, I apologize. I’m . . .
Andrew: That’s your ringer?
Shaul: Yeah, it is.
Andrew: That’s like a party in your pocket every time the phone goes off.
Shaul: I know. I’ll make sure to turn it off so it doesn’t happen again. My apologies.
Andrew: No. So wait. So you’re saying . . .
Shaul: To repeat my answer, I will say that . . .
Andrew: Go ahead.
Shaul: . . . the other form of revenue which is much more interesting is that we actually make our platform, we enable brands and creative agencies, our video agencies to use our software as well. And when we do, we take care of the distribution of those branded campaigns and share revenues back with our publishing partners. So you can go on, I don’t know, CBS or many of the website that use Playbuzz and see not only editorial content but also commercial content that was created with Playbuzz for a certain advertiser or friend.
Andrew: Oh, so the advertiser comes to you, you create the content with them, and then you syndicate it out to the publishers.
Shaul: Exactly. We leverage our network of publishers in order to create great distribution. So much like those advertisers who will otherwise work with one individual publisher, with us they can create content using our tools and then not only have access to sort of best of breed content creation platform but also have access to our distribution network and actually gain much wider distribution.
Andrew: Okay. You know what? That’s a clever way to charge? Why did you decide to do that as opposed to charge per use or give it free up until the first 100,000 views and then charge?
Shaul: So, honestly, I know it sounds a little bit naive and it could sound also self-serving, which I may be guilty of, but my honest answer is that we wanted to make money only when we bring value to the entire ecosystem. So not charge someone and just say, “Hey, pay us money and then good luck to you with your campaign.” It may or may not work.
We only . . . In fact, when we charge brands for usage of our platform, we only charge them on what we call a CPE basis, a cost per engagement. So if somebody visited a web page and they saw an ad that was created with Playbuzz and they build it, we don’t charge the advertiser for it. We’ll only charge them when people actually engage with you, when they click through, when they spend time, when they had a meaningful dialogue with the brand through the Playbuzz unit. And the reality is that the engagement rates are so high that we can afford to do that and then make sure that we remove every friction because we only charge you when we deliver to you value.
Andrew: You know what? That makes sense. So if you were charging me per use of one of your content creation tools, I’d be hesitant. Even if you told me the first 100 is free, I’d worry. What if I get over $100,000? Am I going to make any money? And maybe I’d stay away from using it. And then if I did get over 100,000 and I didn’t make any money, I’d have to figure out a way to profit on my own. You’re saying, “That’s not a great place to charge. Let’s charge them only when they make money.”
Shaul: Great, perfect alignment. We want to say if we’ve done a good job, we want to get paid, and you got the brand uplift and the brand awareness and all of the goals that are relevant for you as an advertiser. So it has to be a win-win.
Andrew: All right. Let me talk about my second sponsor, which actually is very relevant to what we just talked about, and then I’m going to come back and talk about the time that you wanted to fire all your developers and what was going on because this was an up and down story here that you went through.
And so, my second sponsor, I want to know how someone could use Playbuzz with them. It’s a company called HostGator. They basically make it easy for anyone to host websites including WordPress hosted websites. One click button, you’ve clicked one button, you have WordPress installed on your site. Then you customize it. I saw that you guys have a plugin for WordPress. So if someone’s listening to me, let’s suppose they say, “You know what? This whole cryptocurrency blockchain technology is huge.” They say, “I’m going to create a content site teaching people and telling them what’s going on in blockchain.” What are some of the tools that they would use from your site to make their content more engaging?
Shaul: So they can create interactive articles. They can create quizzes. They can create polls. They can create videos using Playbuzz. They can create the kind of content that will make people that otherwise would not bother to read long articles about Bitcoin or whatever it is actually engaged and actually immerse and discuss and anything else to monetize.
Andrew: Let’s say, “What is blockchain? What is blockchain?” It’s been done a million different times. It’s boring as hell to read. And I don’t think it sticks in people’s minds. If they took that “What is” step-by-step explanation, which of your features would they use to tell that to explain that well?
Shaul: So, funny enough, you can just go to Google right now and search for Playbuzz and blockchain and I bet you, you would find dozens or hundreds of thousands of different content creation that were created by many publications around the world, maybe financial media or other that are talking about blockchain using the Playbuzz tools. We are very content-agnostic. You can use our toolset to create content about any topic in any vertical and whatever, be it sports or finance or news or entertainment, lifestyle, history, everything, and it would just be more engaging because it’s not going to be a little chunk of text. It’s going to be more visual, more interactive, have more video and more fun stuff in it and easier to consume.
Andrew: Okay. All right. I’m looking at it, and I do see a bunch of different ones. And they’re . . .
Shaul: I want to just go back to HostGator, I want to tell you that the first version of Playbuzz was hosted on HostGator.
Andrew: Oh, is that right?
Shaul: So we’re probably still HostGator customers until today. So yeah, definitely all work for life.
Andrew: I say this all the time in my interviews. So many of the interviewees here have said that they started out on HostGator. Often they stay with HostGator. All right. If you’re out there listening and you want to host your website right either because you’re starting fresh and you want to do it right from the beginning or you don’t like your current hosting company and you want to switch, go to hostgator.com/mixergy. They’re going to give you up to 62% off their already low prices, and they’re going to make it super easy for you to get started. And I did do that search. Go search for Playbuzz and whatever it is topic that you’re looking for or whatever topic just comes to mind and get it sense of what people are doing with Playbuzz. And yes, Playbuzz has a plugin for WordPress and it will work on HostGator, of course.
All right. Let’s go and talk about the time when things weren’t going so hot for you. What led you to a point where you said, “Maybe we should just let go of all the developers”? Where were you guys as a business?
Shaul: No. It was back in the time that we spoke about when I was pitching the platform to publishers but they wouldn’t buy in, and we were just going to run out of money. We raised some seed money, we were just about to run out of it, and we said, “Maybe we should let the developers go. The product is already at some stage where we can show it, and if nobody’s buying it, instead of developing more, let’s just give ourselves more time to sell it and then if people actually buy, we’ll go back and develop some more features.”
And instead, we took the great decision to rather than reduce costs to actually increase costs and kind of double down and say, “We’re going to hire a content author, and instead of giving up on developing the platform, we’re going to develop it and we’re going to create multiple good examples and that’s going to help us sell.” So, in retrospect, hiring that content developer made the difference between us and success at the time. But before that, we were pretty much on the verge of giving up. And a lot of startups . . .
Andrew: You know what? I told you, I looked at . . .
Shaul: I mean, you’ve interviewed a lot of entrepreneurs, so I bet you run into that all the time. Every company runs into those phases where you think like it’s all going down and it’s never going to work and you’re ready to give up. And for some, they actually reached that point and they give up, and some actually continue a little bit more and eventually find a way to pull through and become very successful companies. So it’s always a . . . Even when it seems lost, a real entrepreneur always keeps on trying and always keeps on fighting.
Andrew: So I saw the old content. When I talked about how it looked like BuzzFeed, I feel like you were embarrassed by the early version. It was like, “Yeah. That’s our first version. Andrew is making fun of it.” I’m not. I liked it. I thought it was really good. And the old quizzes were still good. I’m wondering when you have this new piece of technology that you’re trying to show in the best possible light, how do you find somebody? How do you hire? What were you looking for to get that kind of quality out of them? You can’t say, “Go find someone who’s done this a million times on this platform.” The platform didn’t exist.
Shaul: So we already disclosed the fact that that person we hired, her name is Shachar Orren and then she’s today that Chief Storyteller at Playbuzz. So we do something every day and is a very important part of our success, was definitely a key hire for us. I mean, she definitely made a huge difference, and I think it’s an interesting question about the hiring criteria because she was a journalist, so she was an experienced content author or experienced storyteller, but she did not have any relevant experience in traditional media. And the choice in her was a little bit non-orthodox.
I think what really convinced me that she will do a great job was that I was following her on Twitter, and I could just tell that even though she didn’t create content for digital media before, she gets it. The way she expressed herself on Twitter, which back in the day was only 140 characters, so it was rather challenging, I just felt like she has the vibe, she speaks the tech language, she understands. She’s significantly younger than me, and I just felt like she gets it. And she’s very digital native. And even though she didn’t work in digital media before, she relates to it in a very deep sense. And I think that that was really the . . . So I was drawn more to that than to necessarily the specific experience that she had before.
Andrew: All right. You’re starting to build up. I think you told our producer, one of the first quizzes . . . First of all, her quizzes took off and did well, but then the first one that did really well massively without her was about three months in, a professor at Oxford, England, he found your software, and what did he do with it?
Shaul: So it’s a she. A person, yeah, from Oxford, England, that one of the users that created content on our site created this quiz called “Who were you in your past life?” And on the surface of it, it didn’t look or feel any different than any other piece of content was created with Playbuzz, only that I guess it was just much better return and much better experience than it was.
That moment when people talk about overnight success, obviously, we struggled for two years until we got to that night, but we did experience this overnight turn in which, on February 27, 2014, we had about 1,000 unique users per day. And the following day, we had 1 million. So that was just this one piece of content that went viral and everybody was so into it because it was so well written. And that really proved the concept for us that when you give a great set of tools in the heads of very talented people, they can create marvels with it much beyond what you can ever create.
And then the more the secret, I guess, in viral media is that once we had a million users on our website, some of them also explored the other piece of content and some of them decided to create their own piece of content. And some of those creations became hits as well. And so the snowball started rolling and kind of led us to those numbers that before that were just inconceivable. I mean, I would never . . . I kind of I dreamt about it, but I never seriously imagined that we will get to millions and then billions of users. It was completely beyond my wildest expectations.
Andrew: What’s your process now for getting customers? You’re not waiting for them to discover you. You were starting to say earlier that you go to different events, and I cut you off because I wanted to save it for later so we can stay in chronological order. Talk to me a little bit about what the process is for bringing a stranger in and explaining the process and signing them up and getting them as customer.
Shaul: So today, the majority of our business and marketing activity is actually geared towards brands and agencies. We’re educating them about how can they create brand awareness and promote a product for good using the Playbuzz tools. So we recently conducted . . . There was recently a research conducted by Nielsen that was examining the impact of commercial campaigns that were content marketing campaigns that were created with the Playbuzz toolset, and it find out that it create brand awareness of about 91%, which is more than 12 the industry standard, the average. So just another great testament.
And just like when you use our tools editorially, also when you use them commercially when you create content that’s really attuned to how people consume content and really speaks today’s consumers’ language, it resonates much better with them and create much better impact. So the majority of our efforts are now on working with brands and agencies to create campaigns using the Playbuzz tools.
Andrew: And I guess you already have relationships with them and sound like you’re out there looking for new ones. Is that right? I mean, there’s . . .
Shaul: Yeah. We always expand into new territories. We also are working with different agencies on incorporating our toolset and how to introduce it to their clients and with the clients on how to use their tools in very diverse ways, how to create videos and quizzes and directive articles and use all of the different tools that we offer. But sure, I mean, the majority . . . I mean, we’ve already been . . . We’re not new to that market anymore. We already been used by hundreds of different brands around the world, including some of the largest and most lucrative brands in the world. Same goes for publishers. So we do have some decent market exposure.
Andrew: All right. Now, the business is starting to do well kind of like you were, and at some point, the business had a midlife crisis, and you described it to our producer as you looking around the office and saying, “Who are these people? We have 100 hundred people working at this company.” What happened?
Shaul: We have more than 100 people. Look, I think that when you grow, you are bringing in a lot of different people and some of them work really great and some of them don’t. It’s a very different dynamic. The company today is a very different dynamic than it was when we were just six people producing the early version of the platform that you’ve seen and kind of got successful and put us on the map. And my challenges as the company’s CEO and the management challenge is how to preserve those qualities of that culture, how to continue and be agile and innovative and creative and informal and fun and yet be able to sustain a larger business that obviously a lot more people need to be in the loop and be informed and everything else, so you kind of have to develop more formal ways of communication. And it’s a constant learning experience about how to find that right balance, how to mature but not get all too fast. How to get more productive, more effective on a larger scale without losing that [ooh 00:50:04] factor that made us successful.
Andrew: All right. Sorry. I got a call . . . I never got a call about my kid. I got a call about my kid. I’m saying, “Is this a crisis or not?” because I’m in the middle of something.
Shaul: Hopefully, he’s good.
Andrew: Hopefully, it’s not a crisis. They’re in good hands. So let me close out with this. This is kind of a selfish . . . Here’s the thing. I talked to you a little bit about your dad. I’m going to feel like . . . I’m going to beat myself up later if all I do is leave it with like, “How do aspire to be as great as your dad?” and I’m too chicken to say your dad went to jail for bribery or something, right?
Andrew: How did you take that? You know what I’m saying. So tell me about what was going on with you.
Shaul: I think . . . Look, in my personal life I don’t want to sound like too old of a guy, but I’ve been around for enough years to have experienced many ups and downs in business and in personal life. And my dad had a very prospering, a very fruitful and a very successful career. And then he had some downtime in his personal life and his career as well. And for me, the only thing I can say is that I love my dad, and he’ll always be my dad of choice whether he’s elected by the people or whether he’s convicted by the judge. All of that doesn’t really matter. And when tough times come, you have to learn to deal with the outcomes and grow over them. And now that we all decide . . . when we’re on the other side of it, both my dad and myself and our entire family are stronger and more capable of dealing with whatever hand life has to deal for us. So at the end of the day, it’s a tough thing, but life goes on.
Andrew: And you’re proud of him. And your kids now, do they understand what you’re doing? Are they proud of what you built?
Shaul: I sure hope so, yeah. It’s one of my happiest . . . The happiest moments are when not only when the company is doing well but also when my kids really understand and really relate to it. So when my kid calls me from school and say, “Hey, dad, I just saw these two kids and they were playing on the Playbuzz app and I told them, ‘This thing, it’s the company that my dad created.'” And all that. Honestly, this is probably the best reward you can get from everything you’re doing. So I’m really psyched about it.
Andrew: Yeah. You know what? Through Mixergy, I’ve gotten to know some people in the audience who have these really interesting businesses, but they’re not the kinds of things that you’d want to tell your kids. I’m not just talking about porn sites, but it’s like the gray, a little bit weird, they don’t use their real names, they use online personas. And yeah, they might be making money, but they’re not having an impact. And if you can’t be proud enough to tell your kids what you’re doing, then how could you live with it yourself and be proud in your own skin with it? All right. I got to . . .
Shaul: [inaudible 00:52:49] I mean, as I said, it’s when I started Playbuzz is because one of really the guiding principle was to say, “I want to do something that I’m so passionate about that I can really explain it to my kids and they’ll be proud that I’m doing it. And I felt that . . . I think that when you really ask yourself that question of what is that thing that will get you there and then you really follow your heart and do that, it can get you to really interesting places.
Andrew: All right. For anyone who wants to go check it out, go check out. You know what? They’re going to go to playbuzz.com, and they’re going to see the business side which I think, yeah, you can look at it. You guys if you’re listening and you’re publishers, you can see how you can install Playbuzz on your site and how you can use it. But I think if you start searching for Playbuzz, once you gave me that, I started typing around the idea of searching for Playbuzz and a phrase to see how it’s used to explain that phrase, then you got something. All right. Thanks . . .
Shaul: Or just follow up on social media and see the best-of-breed creations that we are promoting, so you’re going to get a sense of how different publishers and brands are using our tools.
Andrew: The best of what?
Shaul: I’m saying that on social media if you follow us on Twitter or Facebook or . . .
Andrew: Oh, yeah, yeah.
Shaul: . . . somewhere else you can see different examples of how different companies are using Playbuzz.
Andrew: All right. Thanks so much for being here. Congratulations on want you built. Thank you all for listening.
Shaul: Thank you.
Andrew: And I want to thank the two sponsors who make this interview happen. The first one is Regus. I’ve been with Regus for about 10 years now. Really, if you want to get yourself and your team productive, go to Regus, let them take care of everything. I have an envelope. This is how much of a baby I am. I will not even put a stamp on my envelope. I give it to the receptionist, “Take care of me, please.” I have something that needs to go out, the receptionist. Go to regus.com/mixergy or email me and my team at email@example.com and we’ll introduce you to our person over there. And if you want to use Playbuzz or so many other plugins on WordPress, go take your site to hostgator.com/mixergy. They’ll give you a good price and take good care of you.
Thank you all for listening. Thanks for doing this interview. Bye, everyone.