Reflections & analysis about innovation, technology, startups, investing, healthcare, and more .... with a focus on Minnesota, Land of 10,000 Lakes. Blogging continuously since 2005.
The highly successful Minnesota mobile startup has been acquired by Newscycle Solutions, a 500-employee Bloomington MN-based firm that “develops and delivers software technology to empower the global news media industry.” DoApp has developed more than 1,500 mobile apps for the news publishing and broadcast industries. All DoApp employees will join Newscycle. The acquisition closed on June 10, 2016; the price was not announced.
DoApp was founded in early 2008 by former Google employee Joe Sriver and a small team. It has been entirely self-funded and profitable for six years. Newscycle Solutions is made up four merged companies and is owned by Vista Equity Partners, based in San Francisco, which was the most active firm in the M&A business last year. (Within the past two weeks alone, it acquired Marketo and Ping Identity, deals valued collectively at $2.4 billion.) Continue reading
Minnesota’s NativeX announced today it is being acquired by Guangzhou-based Mobvista, Asia’s largest mobile advertising company. The company said the all-cash deal is valued at 160 million yuan, or 25 million US dollars. Once the transaction is completed, NativeX will become a subsidiary of Mobvista.
NativeX was founded by Minnesota twin brothers Rob and Ryan Weber and traces its beginnings to a former company they and a third brother, Aaron, founded in St. Cloud more than 15 years ago, called Freeze.com. The firm later changed its name to W3i, then made a major transformation to mobile ad technology in early 2013, rebranding to NativeX. It specializes in monetization and advertising through proprietary native ad technology for mobile games and apps.
Mobvista also has offices in Hong Kong, Beijing, New Delhi, Singapore, and San Francisco. NativeX has offices in St. Cloud (Sartell), Minneapolis, San Francisco, and Finland.
Rob Weber will continue as CEO of NativeX, and serve as a vice president of the Mobvista Group. “We currently have 40 employees in Minnesota,” said Rob, “and we’re planning for all of our current employees to stay on. Also, as part of the growth opportunity presented in light of the merger, we plan to hire additional employees at both our Sartell and Minneapolis locations.”
Rob continued: “Ryan and I are very excited with our new partnership. Strategically, it makes sense to combine forces with a strong force in Eastern markets. We are planning to stay on board in the same roles we have now.”
Okay, that may not be news to you if you’ve done at least one startup. But what’s not well known is that many inexperienced founders — and investors, too — think it bears little resemblance to traditional brand marketing, and that it can be done with, um, little or no money.
(David heads an agency in LA, which has become a hot startup community — a very large one! Here’s his bio.)
“The myth out there is that startups don’t have very high budgets because they’re – you know – startups, so they shouldn’t pay marketing agencies, ad agencies, the gardener, the people at the counter at Burger King, or other professionals at the same rates that those nasty big brands do.
They should pay more.”
Yes, you read that right — that’s what David said. Because startup marketing is in fact harder than traditional brand marketing, he maintains. In his post, he goes on to make an excellent argument about why… which, as someone who’s focused virtually my entire career in this space, I think really nails it.
“Working with a startup team takes every bit as much time, creativity, effort, critical thinking, planning, strategizing, communication and resources as working with the marketing team at a big brand, and probably more.”
David gives five reasons why the above is true:
1. Nobody knows who you are yet.
2. You are every bit as demanding as a brand marketing team.
3. You are very stuck on your own ideas and greatness.
4. You often hire an agency to shut up and do as they’re told.
5. You keep changing your mind about stuff.
You can read more on those points in his post. Now, granted, saying all that is pretty easy — but what can reasonably be done to do something about this problem? And it is a real problem — one that’s holding back too many startups. But let me try, with my own list of 5 things:
1. Founders need to get real about marketing, plan better, and budget more money for it. They can and should seek help in this regard. Good advice is available out there from many disinterested parties who can provide objective feedback or recommendations. Obviously, every startup needs advisors, and you’d be taking a big chance if you don’t have a marketing person on your advisory team! And I say that even if you already have a marketing cofounder — because an advisor can provide a valuable sounding board. The critical, overriding marketing question for your startup is this: what will it really take, dollar-wise, to achieve the level of traction or market penetration that your plan calls for?
2. VCs and angel investors need to better understand marketing. They’re largely finance people. Most VCs don’t even have startup operational experience (yes, angels are more likely to), let alone marketing. In my thirty years of working with startups, I’ve run across precious few investors who are really marketing savvy (unless you count those who actually believe in the viral-marketing fairy). Sure, some VCs may have taken a marketing class or two for their MBA, and they talk about customer acquisition a lot, and but most don’t really understand all the things needed to make that happen — nor the investment it requires. The lucky startup that just “takes off” via word-of-mouth is rare indeed. (Granted, some of the top-tier VC firms actually employ smart marketing people as part of their portfolio company support team — which is one reason they’ve achieved top-tier status. But these are very few indeed.)
3. Founding teams (and any and all people involved in startups) need to adjust their expectations. There are many misconceptions about startup marketing, and a good advisor can help in this regard. For example, founders have to stop thinking that, if they could just get media coverage in TechCrunch or VentureBeat or some other such media site, all their marketing problems would be solved. “We just need a ‘kick-start’ and we’ll get all the signups we need!” Dream on. I can have you talk to some founders for a reality check.
4. Watch out with that term “agency” — meaning most startups actually don’t need an entire firm (and the overhead that goes with it). Let’s use the term here to just mean a small creative team, often simply two people: a writer and a designer. Those are the key operatives. But they of course need to be experienced startup marketing strategists at the same time, with an understanding of media — or the latter can be an additional team member. What working with an “agency” really means for a startup is the smallest possible team, who can wring the most value possible out of a modest budget. But, because they have startup chops, they should be paid well. Yes, even more than their counterparts on a traditional “brand” agency team, because this is different, more specialized, and harder work that run-of-the-mill work for established brands.
5. As a founder, think very carefully about how much you allocate for marketing in your proposed “Use of Funds” — that is, the percentage of the total dollar amount you plan to raise (or do raise). Investors need a critical eye here, too. Especially watch out for a line-item that says “Sales and Marketing” — that doesn’t cut it! First of all, sales is a subset of marketing in any successful business. It’s the here-and-now, the day-to-day, the “who am I going to sell next?” It’s not marketing, which is about planning and strategy for a longer term than… um, a few days, a week, or a quarter! Sales is heavily oriented toward people expenses (salary, commission, travel, etc) — marketing not so much. Rather, it’s more about media, advertising, research, PR, customer acquisition, even some product development activities. Costs attributed to “Sales,” especially for a startup that must build a salesforce or a channel, can quickly escalate and overshadow dollars that really need to be invested in Marketing. Word to the wise: don’t put the cart before the horse. Good marketing — planning, strategy, brand building — must get attention ahead of investments in Sales. The right Marketing will drive the right Sales.
Yes, startup marketing is hard. Get help, think big, and don’t cheap out.
(Note: This post first appeared yesterday at Minnov8.com.)
What if you could post an ad in three minutes and geo-target it to
mobile users in a given radius around you — or across an entire network
of 45 to 50 million of them — then start seeing results minutes after
that? Well, you can — I know, I did it, with a new self-serve ad
service called Adagogo, soft-launched in recent days by mobile app platform company DoApp Inc. (www.doapps.com), based right here in Minnesota (Rochester and Minneapolis).
DoApp founder Joe Sriverbegan working at Google in early 2001 and
knows a thing or two about online advertising. "After joining Google, I
found out that I'd been about the 20th advertiser to sign up for
Adwords. Also, I learned that Adwords was the reason my hire date was
pushed a few months, as they were so heads-down developing it." As
Google's first UI designer, he soon became steeped in AdWords himself.
"It's a great product, and I'm proud to have been part of its history,"
he said. However, it's become complex, really complex. It's gotten so
new users either need to spend days trying to understand all the options
it now offers, or hire a professional to manage their ad campaigns." He
doesn't think that's right.
"What's
been missing in all this," says Sriver, "is an easy method to just get
your web site, business, blog, or app in front a lot of people quickly."
(Hello, startups!)
"I think we've developed the simplest way to quickly place your ad within thousands of local and national apps, on all the major mobile app
platforms," said Sriver, "Our network of users today is substantial,
between 45 and 50 million people, and it will continue to grow rapidly."
Because
you can target locally or advertise across the entire network, DoApp
says Adagogo is "great for everything from getting traffic to local
garage sales to building national brand awareness." How's that for a bold addressable market?
Sriver
recounted how he experimented with a lot of new ideas since he launched
DoApp in early 2008. The company's main app platform business (both Mobile Local News and Real Estate) continues to grow rapidly. (See my previous coverage of the company here, here, here, and here.)
But, of all the new side-project ideas he's played with over the years,
Joe says Adagogo is the one he realized had the most potential to get
traction.
How to Post an Ad with Adagogo:
> Choose geographically where you want your ad displayed > Enter your ad copy and add a picture > Select the amount of ad impressions you want to display > Add a web site URL, phone number, and/or location > Enter your credit card info > DONE!
I Did My Own Self-Serve Ad Test
I set up an ad on Adagogo the other day just to experiment with it
myself. And I must say, it was quite easy. Nice, intuitive UI — really
simple and clean. My ad is the shown here with the headline, "Learn About Big Data." The goal was to drive traffic to a Flipboard magazine
— which I had launched a while back on a lark — just to see how many
people I could get to subscribe with a mobile ad. Joe told me that 1000
ad impressions, the option I chose (price: $25) would go quickly on the
DoApp network — in about 2-3 minutes. He was right. I watched as my
subscriber count went up 20%+ almost before my eyes. Once my ad
impressions were used up, my click-through rate was 1.2%. Not bad, as
the ad was just promoting a web site — to get people to subscribe to a
free mag — not some giveaway, coupon offer, or contest.
So,
across what geography do users see the ads? "Many of our apps are local
or regional news apps," says Sriver, "but we do have a number of
national and international news apps as well. You can either choose to
advertise locally within a 5, 10, or 50-mile radius around a location
specified by you. Or you can have your ad displayed 'Everywhere,' which
means wherever our apps are used around the world." One of DoApp's
widely distributed news apps, with a worldwide footprint, is called Headlines.
"Across iOS, Android, Windows Mobile, and mobile web, we currently have more than 1500 apps," says Sriver. "That
number will be going up significantly, as all our real estate apps will
soon have access to the Adagogo network. So our total number of
available apps where Adagogo ads appear will grow a ton – stay tuned!"
Seriously,
I can see Adagogo used for garage sales, fundraisers, local mom &
pop stores, online businesses — even big brick-and-mortar retailers
and, heck, ecommerce giants, for that matter. A Best Buy, for example,
could advertise individual store deals using local-radius targeting, but
could also do general brand advertising across the entire 50-million
user base – say, to hype a Super Bowl commercial, or a contest or
sweepstakes. No special expertise required — really anyone can use the
simple Adagogo interface.
"From our start, DoApp's mission has
been to help in the growth and success of communities and local
businesses through new technology," says Sriver. "Adagogo builds on that
mission."
A Special Offer This Month In announcing the Adagogo
soft-launch, Joe offered up a special promotion.
With any ad package you purchase, the company will double your number of
impressions. For example, buy the 1000 ad impressions package, get an
addition 1000 for free (2000 total). Buy 5000, get a total of 10,000.
This "buy one get one deal" is available only until October 31, 2013,
and is for ads that are specified to run "everywhere," as opposed to a
specific location. Just place your ad before midnight Central time on
October 31 and you'll automatically get double ad impressions.
—————-
Postscript: See DoApp at MobCon Wade Beavers, CEO of DoApp, will be speaking at a mobile technology conference coming up in Minneapolis, Nov 7-8: MobCon. (Online registration still open.) His session and description: "It's all about your latitude and longitude. How location is changing mobile." "Location
and mobile are a perfect match. Learn more about how device latitude
and longitude are changing the mobile game for advertising, social,
commerce, personal data, and content distribution. A recent study showed
that 43% of users were willing to provide their location to companies
compared to less than 11% willing to share their browsing history. Has
location information become the new cookie? You will learn: Location
Data Trends, Effective Location App Offerings, Location Data Use,
Consumer Behaviors, and Location Best Practices."
Minnov8 will be reporting from the MobCon event, so look for us there!
—————–
Disclosure:
DoApp is one of the companies in my client equity portfolio. I helped
launch the firm in 2008, serving as its VP Marketing.
DoApp Inc., a Minnesota-based mobile app development firm (www.DoApps.com), has come a long way since its founding five years ago. I had a chance to sit down with the management team last week in the company's offices in Rochester, Minnesota, where most of its employees are based. (Disclosure: I have a small equity position in the company, as I helped it launch in 2008. So, go ahead, call me biased!) It was the first chance I'd had in a while to catch the management team together in one place (left to right in the photo below): Wade Beavers, CEO: Joe Sriver, Founder; and Dave Borrillo, COO. Wade and Dave call Rochester home, while Joe is based in the Twin Cities. (They met when they all worked for IBM-Rochester, before Joe moved West to join Google in early 2001.) DoApp now boasts 19 employees, with a handful located virtually, one as far away as Vancouver. A core group of employees has been with the firm since 2008. This company has had amazingly little turnover, which says a lot in today's environment. See more about DoApp's talented team here.
What do I mean by "come a long way"? Well, ever since the company launched its first apps right when Apple opened the App Store in early 2008 (I was there — it was a wild time!), it has been one amazing run for these guys. Here's how DoApp describes itself on its web site: "Great design and enterprise-level code comprise the core of DoApp. We've built over 1500 apps for all major mobile platforms. After millions upon millions of downloads, our mobile strength has been tested. We are a pioneer in mobile app development. We are a leader in mobile app experience." (Note: about 400 of those 1500 apps are iPad apps.) "We are obsessed with mobile: continually developing new ideas, user experiences, and methods of engagement. This is what we love to do." That is about the most you'll ever hear DoApp brag. There isn't even much detail on its web site. These guys don't talk a lot about themselves; they just keep executing, signing customers, and building their business. That's why I had to make my trip to Rochester, to find out more… 🙂
So, what did I learn? Well, these guys have way too much fun together — but I seriously believe a sense of humor is mandatory for any startup. And I'm sure that has something to do with how tight-knit the team is. I also gleaned some pretty impressive stats (below). And I learned the company has been profitable for some time, and that applies to both its major businesses: publishing and real estate. The company has had no outside investment, by the way — it was self-funded initially by founder Joe Sriver, and started booking revenues immediately after launch. So, DoApp has been quite a home-grown Minnesota startup success story — even if it has been a bit more low-profile than many. So, about some of those stats…
DoApp's Publishing and Advertising Business:
The company has customers in 110 local markets across 34 states, and those include 176 TV stations, 58 radio stations, and 110 newspapers. Just search "DoApp Inc." on the iTunes App Store or on Google Play to see the huge number of apps it has developed for these broadcasters and publishers.
DoApp's Real Estate Business:
The company also has been building its real estate app business for several years. Recently, it formed a partnership with CoreLogic, a leader in the real-estate market that has an estimated 70% of the Multiple Listing Service (MLS) market in the U.S. DoApp powers all of CoreLogic's "GoMLS" app offering. The GoMLS app (see the iOS version here) can only be used by real estate agents, brokers, or other affiliated professionals that already have an active MLS subscription for this service. It gives agents a time saving, easy-to-use, data-rich mobile app for access to listing data and more, directly from Apple or Android devices. It integrates with other systems and CoreLogic products to allow professionals to access saved searches and contacts, and edit key fields on-the-go. CoreLogic is a publicly traded firm (NYSE: CLGX) headquartered in California that provides property information, analytics, and services in seven countries.
Separately, DoApp serves as the mobile provider for the MLS organizations in Chicago, San Diego, Tulsa, Georgia, Birmingham, and more. These relationships, along with the CoreLogic partnership, make DoApp the largest provider in the U.S. of mobile real estate solutions for MLS organizations.
In addition, DoApp has 17 of its own branded apps covering sports, weather, news, and tech, which together now boast more than 8 million unique users. Some of these include:
After it was launched back in 2005, Graeme Thickins on Tech was named several times to the list of top analyst blogs (last ranked as #119 on the list, under the blog’s previous name).
DoApp has gone and done it — and, yes, it’s cool.
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