Sam Barnett tells Lucie Mitchell how, since founding ad personalisation firm Struq with a debt of £2,000 that was owed to him, he has turned the company into a global, profitable operation after just five years.
Despite studying law at university and going to law school, Sam Barnett was unsure about it as a career. Lucky then, that he was offered a position at a high-growth advertising startup called Espotting, now known as Miva.
“This startup was doing some really innovative things to power search advertising on Yahoo,” recalls Barnett. “I joined their legal department but after a year, I realised that my career wasn’t best suited to law.
“Seb Bishop, the founder of Espotting, saw that and suggested I work for him, drafting his legal contracts, and he’d teach me about advertising and running a business. I thought, that sounds better than the stuff I do now, so off I went and joined Seb and his team.”
When Espotting went public on the Nasdaq and became Miva, Bishop became the youngest president of a Nasdaq-listed company. Barnett says he learnt a great deal about entrepreneurship from him during his time there.
“I learnt about online advertising and fast-growth companies and I began doing business development across Europe,” he says.
Barnett was then asked to be one of the first people at another advertising startup, AdJug, to build up the publishing side of the business.
“My career had been transformed in a very short period of time, from negotiating warranties and limitations of liabilities, to doing business development and growing these startups,” he remarks.
Then, in 2008, Barnett had his light bulb moment, and the idea for his ad personalisation business was born.
“I started Struq because I wanted to change advertising so that every ad was relevant and individual to every user, which would then provide a better online experience for individuals and better performance for advertisers, through personalised advertising.”
He decided that £2000 would be enough money to self-fund the business, however he didn’t have any savings at the time and was instead relying on some money owed to him.
“I had done some legal work for a startup and was told I would be paid £2000 for the work in 30 days’ time. So I handed in my notice at my job, employed someone, and essentially started Struq on a debt that was owed to me of £2000, but wasn’t collected.
“In hindsight, starting a business on a debt from a startup who says they’ll pay in 30 days’ time isn’t probably the smartest move, but I was young and naïve and just believed people would do so.”
It soon became apparent that he wasn’t going to receive his money within the agreed terms, so Barnett had to act quickly to ensure the business didn’t fail before it had begun.
“We had this ideal on how we wanted to change advertising through personalisation, but we didn’t have any money. We then decided we’d build a product, sell it, see if it got traction, and if it did, then we’d run it, and see what worked.
“So we went through a very aggressive phase of making money to survive and going through a very aggressive ‘build, measure, learn’ cycle, so that we could build a business.”
They soon began to make money and signed their first client, Jobsite. Struq now has 350 clients from 19 countries, including EasyJet, Debenhams, Hilton Hotels and Nike. The business has grown extremely fast, says Barnett.
“We have always had triple-digit growth, from 2008 when we first launched, to 2012. We now have offices in
London, New York, Germany, Brazil and Turkey, and we employ just under 100 staff.”
He says that what sets his business apart from others is that they are able to personalise every individual element of an ad, so that the ad is created dynamically in real time.
“We can personalise an ad to any individual across any device or channel. So we work with big brands on a global basis, and for every £1 they spend with us generates between £20 and £30 through people clicking and buying through our ads.”
So how are such high returns generated?
“We see a user across any device, so we are able to understand how profitable a user is likely to be, what they are likely to buy and how an ad should be formatted in a way they are likely to click and buy from,” he explains.
“We personalise those ads across Facebook, mobile, video and display, so we are creating a personalised ad experience. And that enables us to deliver un-matched returns for retailers.”
The industry is obviously evolving at a record pace, so how does Barnett intend to capitalise on that?
“Consumers are now making lots of different decisions, using lots of different mediums, and you can see what devices are becoming connected, and one of the things this really opens up for the business is that it enables us to create a far more personalised experience across the devices people use in their everyday lives; they have a more relevant ad experience and that drives better performance for advertisers.”
Barnett has learnt a great deal in his five years of running a business, but the most important is hiring the right people and nurturing the right culture.
“When hiring an executive management team, hire for things you need in the next six to nine months and not the next two to three years,” he advises.
“Also, always be true to the values that make you as a company and always make sure you hire people with the same values. If you get that wrong, despite how great a person’s CV is, it is very tough for a business. Culture is everything in a business. It is the glue that binds everyone together. So hire for culture, and ensure that people are aligned with your values.”
Last year, Struq completed an $8.5m funding round, with investment from Reed Elsevier Ventures, Pentech Ventures and Allen & Company LLC. Barnett now hopes to expand the business across the US and open up new markets.
“It’s really about global scale, recruiting the best talent across every territory, creating a great environment for people to work in, and ensuring that our culture remains intact as a global business.”
source - businesszone