Welcome to issue #1 of our first-ever Q&A series, called Startup Spotlight!
This series is all about diving into the world-class technological innovation conducted by exciting UK startups. Getting to grips with the technology, the mission, and even the stories behind them.
In each edition, we sit down with a different startup founder, leader, or operator in an easily digestible conversational style Q&A format.
Today we’re diving into the story of AudioMob, and its CEO, Christian Facey.
AudioMob is tackling the issue of in-game advertising, by facilitating non-intrusive advertising experiences that keep players.... well.... errr... playing.
That sounds super obvious and straightforward. But, for any ad supported product, there is always a constant ongoing tension between retention and monetisation that a creator or developer must fine tune and balance.
Over the last decade, the free-to-play mobile gaming industry has gravitated towards evermore intrusive ad formats that interrupt gameplay.
Why? Because they pay better. Game developers that monetise players better can bid higher on advertising platforms for more players. Creating a compounding growth loop effect.
Interuptive ads have always been a tempting 'low-hanging fruit' monetisaion option in that respect. But, this approach quickly reaches a saturation point. Players churn.
Therefore, a kind of rebalancing is needed. Ads that monetise well but allow the fun to continue.
As you (astutely!) guessed from the name, AudioMob's answer to this is audio ads on mobile.
- 🏎️ AudioMob's journey from Series A to Series B
- 📈 Scaling when demand exceeds operational capacity
- 🚀 Why Series A companies should have an R&D Lab for moonshots
Do you dislike interuptive mobile ads? You’re not alone.
If you’re a mobile gamer you're likely used to being taken out of your flow by a video ad that forces you to watch it before you can continue playing. Or, maybe you just needed an extra life or upgrade and felt the trade off was worth it.
Either way, many gamers lose interest during such video ads and move onto something else. Sometimes, enticed by another game ad in a competing genre. A shocker!
But, if ads are unavoidable in the free-to-play industry, how do we craft an experience that's less painful for the player?
AudioMob has figured this out.
With audio ads, players can keep playing their favourite games and marketers can keep delivering their (hopefully!) pitch-perfect ads. Both parties get what they want.
But what exactly is AudioMob?
What is their approach to R&D?
And how are they scaling their business?
We interviewed the CEO of AudioMob, Christian Facey, to find the answers to these questions. Here we go.👇
What's the mission of AudioMob?
To bridge the gap between audio and mobile.
Right now, inside games through non-intrusive ad experiences.
In-game monetization is broken — seventy-percent of publisher ad revenue is intrusive.
Plus, audio is underutilised as a format. We're unlocking a medium with a total addressable market of $39bn on the most used device globally, mobile.
Our technology serves as the 'bridge' between advertisers and game developers for audio inventory. To get setup, game developers install our Unity plugin and configure the AudioMob ad experience to suit gameplay. You can see our tech in action by downloading our demo game, Chopper Strike (iOS / Android), or heading over to our website.
You raised a $14m Series A round in 2021. Walk me through your journey since closing it.
The idea behind the Series A raise is to prepare us for the Series B.
Last year, 2021, was excellent. A year of scaling.
We made a big R&D bet that paid off. Which, was, to focus on building an advertising platform that would bring more value to clients and game developers, faster.
It's also been a process of managing huge global shifts. The state of the world keeps changing. Out of a pandemic and into a European war, we're constantly trying to forecast how quickly we need to change our strategy.
Over the last few months public sector and growth sector stocks have faced a challenging evironoment. Issues in Ukraine have increased the amount of uncertainty that large cap investors have in the tech market. This has a knock on affect to earlier stage startups.
It's safe to say that our mindset, in terms of getting to Series B, has definitely changed since the start of this year.
So, it's using the money to figure out how we can build and grow, whilst adapting quick enough, to keep scaling for that growth.
Personally, I've been impressed with AudioMob's product innovation cadence and go-to-market strategy. Particularly for a team of around 20.
You always seem to be in the press, announcing something exciting and new.
Thanks. We have not hired an external PR firm to acheive that. It's all handled by myself and my co-founder Wilfrid Obeng. We setup a system, based upon a framework from a book called Growth Hacker Marketing by Ryan Holiday, where we tested a bunch of growth experiments and doubled down on those that worked. We now have a system in place where we input a story and it gets published and talked about in all kinds of places.
Before that, we started experimenting with using automated bots for outreach, to pitching case studies, to paying for PR, we tried everything. Then, we over indexed on the thing that happened to work.
All of that innovation and press coverage means we have a huge publisher waitlist that far exceeds our ability to onboard them. That's not just small to mid-size publishers, either. We are literally 'saying no, not yet' to some of the biggest game publishers in the world.
Let's talk about scaling, operationally. This seems to be your biggest challenge right now. Dealing with all of that demand. Walk me through it?
A significant obstacle to onboarding publishers is integrations. One customer could have a portfolio of hundreds of games that we'll need to integrate our Unity plugin into seperately. And, there are several of those size customers in our sales pipeline. We simply don't have enough integration specialists to do that fast, right now.
To solve that, we need to hire. Which, is also a challenge. Let's say we had a specific hiring pipeline, for H1, but the amount of significant changes that we've had to make as a result of the Ukraine war is impactful in terms of delays.
The UK is settling more refugees from Ukraine, which is wonderful to see. However, the Visa website was broken regarding the processing of applications for advanced workers. It's adapting to issues like that. It’s a minor issue for the company, but it does mean that we can't scale certain divisions as quickly.
So then, we have to divert to a remote hiring policy, and adopt new technology so that we can hire remote employees, rather than contractors. This enables us to hire them as quickly as possible.
It's figuring out all of these little sudden changes that makes it so we can keep scaling. Every piece of R&D that we do, and everything that we build, is unique to AudioMob. Patentable stuff that has intrinsic value
Another factor, of scalability, is figuring out the best possible way to onboard big clients as quickly as possible. For example, a big developer will find AudioMob, and then there will be a long term strategic discussion. However, you’ve got another big game developer who want to integrate you the very next week.
We’re an efficient company, and we're able to execute correctly, but there's no way we’re going to take on two or three of the biggest publishers in the world, in the same month. All we have is a company of 21 people, and we will never accept business to increase our valuation, unless we can deliver.
Apart from your sales process, how else have you scaled your company for growth?
We hired a Head of People and a Head of Operations. I don't know how we got this far without doing it. We were lean in our first two years, so it was pretty insane.
We still managed to succeed, however, by implementing a structure that a growth stage company would have before we actually got to the growth stage.
It’s similar to an operational revamp, from how our people department operates, our operations department, sales across game integration, advertising sales, our R&D Lab, our Software Development Kit team, Unity plugin team, and everything else.
If we were to hire another 50 people, the company wouldn't topple over, or overheat. It's really just concentrating on the operational structure to accommodate big changes.
You participated in the Abu Dhabi twofour54 program. How did that happen, and can you talk a bit more about that?
It wasn't strategic consideration, it was actually luck. In 2020, Wilfred, my cofounder, thought, “I'll go on holiday to Dubai for a week, two weeks, see what happens”.
When lockdown happened, he was thinking, well, I might as well stay in Dubai. During the first week, he met someone who knew someone in the government.
We found out, through this person, about a program called twofour54, and how the government is investing a significant amount in the gaming industry.
We were invited to join the program. Wilfred extended his stay by a couple of months, and eventually based our R&D office in Abu Dhabi.
Wilfred evaluated, for a year, what the culture was like, and everything is similar to the west, as you would expect.
Because of those reasons, we're seeing talent from every corner of the world, from Africa, the US, the UK, Europe, all looking and seriously considering relocating to Abu Dhabi.
Your R&D Lab thesis fascinates me. You've recently hit product-market fit and demand exceeds your ability to service it. Why have an R&D Lab now instead of exclusively focussing on growing the core product?
Google and Facebook greatly influences myself and Wilfred's thinking on this.
We looked at Google’s worth. They generate over $200 billion a year, and they're still growing at 20% a year. You'll notice that Google has Google X, right? They have these innovation labs where they chuck a billion dollars at different products, and then one of those products is going to generate $10 billion a year, eventually.
Facebook does the same thing with Reality Labs. They invested in Oculus, and they invested in Libra. And, then they changed their name to Meta.
So, the point I'm trying to make is that once we figure out what the market product fit is, for a seed product, we hire a team to scale it.
We've got eight years worth of products that we are going to build out in scale. We’re not aiming for a billion dollar valuation. We're actually aiming for a $10 billion valuation within eight years.
Even if we get an eighth of that, I think everyone's going to be pretty happy investors, employees, etcetera. That's the way we think about this.
We don't think about our valuation and typically wait 2, 3, 4, years to exit. We think about our IPO being $10 billion in 8 to 10 years. That’s our thought process.
Awesome. On a completely different note, you have the best 'ad blocker plea wall' I've ever seen. 👇😆
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