Jesse Pujji, W’06, C’06 and Nick Shah, W’06
Co-Founders of Ampush
WHEN Wharton alumni put their education to work, they innovate, create value and maybe found companies. These companies include J.D. Power and Associates, Tesla, Space X, Comcast, Huntsman, H&R Block, Cisco, Bazaar Voice, General Assembly and Ampush!
Jesse Pujji, W’06, C’06, is Co-Founder and CEO of Ampush Media, Inc., and Nick Shah, W’06, is Co-Founder and COO. I asked them how they use technology and how their experience at Wharton helped.
Ampush is a marketing accelerator with 150 employees. It partners with high-growth companies and Fortune 500 brands to build and execute marketing strategies that grow revenue and acquire customers at scale. Ampush leverages proprietary technology to optimize the entire marketing funnel, from impression to paying customer. As a preferred partner of Facebook, Google, Instagram and other major digital ad platforms, Ampush serves clients such as Supercell, Hubble and Esurance. The company bootstrapped and never raised venture capital. In 2015, Red Ventures made a $15 million investment.
How do you differentiate Ampush from traditional ad agencies?
We view Ampush more as a substitute for a traditional ad agency.
If you look at those big ad agencies — while 30% of their revenues are digital, most of them license technology, rather than acquire or build it. For us, technology was the first thing we did to solve the problem we saw. Then we merged that technology with creative and strategic services.
We created a model where, if you work with us as a large-scale advertiser, you will have not only access to our technology platform, but also a dedicated team to help you with strategy, execution and analytics. It’s a solution, not just a software feature.
Second, we chose to concentrate on serving select verticals: subscription commerce, direct-to-consumer content and other new marketplaces. The third way that Ampush differentiates itself is in talent. We hire people who are analytical and strategic, and we create that environment where we can confront problems from a “first principles” standpoint. That means we can talk to the CMO about a marketing roadmap to achieve a particular goal.
Explain the power of digital marketing, and the challenges.
Instead of doing a fixed broad-based media buy — say, a TV ad buy for a season — digital marketing allows you to give the right message to the right person, in real time. You have the data to target that person and measure the efficacy of the message.
It is complex. The number of variations you can have are almost infinite — types of audiences, the types of creatives you can use to personalize each message, and what you are measuring
(not only the transaction, but also what led up to the transaction). And the data from that funnel comes in every minute. That’s why software has entered this world and why, when we built this business, we focused on analytics to navigate quantities of data.
Meanwhile, you can’t mortgage the creative and strategic. You need to merge the data science with the storytelling.
Do you use machine learning or elastic search to manage this information?
We collect huge amounts of data — the fuel for machine learning — and use it to run regressions, automate parts of it, and seek to understand opportunities to further optimize the business. A use case would be capital allocation. Think of Facebook and Google, which are very dynamic market- places with a myriad of factors changing every day. How do you decide whether to put $1.00 on Google and $0.50 on Facebook? Machine learning can dynamically make those decisions, although we are still in the early stages.
We do use elastic search, which is a search engine that allows for robust discovery of petabytes of data (, each petabyte equals 1mm gigabytes) to make decisions and recommendations. For a given partner, every day, we have 15,000 ads running across dozens of channels, generating millions of impressions hourly, with all kinds of transactions happening downstream. The ability to get that data at your fingertips and make the right decisions with it — to process that in real time, with every impression a traded asset that must be bid for in the right way — it feels more like a high-frequency hedge fund trading operation, and it demands similar tools.
Why do customers trust you with their data?
There is an acknowledgment that we can’t serve them without having access to their data. This data isn’t on individuals; it’s segment-oriented (for example, men in New York who like finance). They audit our databases to see how we handle that data, as well as our protocols and security measures. The other thing is that our partnerships are built on trust, with a deep and long sales cycle involved, and the partnerships are introduction-driven.
If the alternative is to directly share their data with Facebook and Google, which dominate the landscape, then companies are more inclined to work with partners like us. There is more of a threat in Facebook’s and Google’s broad algorithms, so partners are more sensitive to that. If we can help them make decisions and we can be more tailored than Facebook and Google, that helps build even more trust.
Do you have a heuristic on how startups should focus?
There was a time where we said “yes” to everything — not being thoughtful about our internal resources or about how we could add value to our customers. From 2012 to 2015, we were one of the first to figure out Facebook advertising. We thought, “Let’s just become the best at this,” so we did that one thing for about 100 clients. Our strategic partner, Red Ventures, told us, “To build a long-term, sustain- able business, you should focus on fewer customers and go deeper.” You talked about being nimble. One advantage that a startup has over an established company in any space is that it doesn’t have to pay the bills in the same way. You can take a niche for any startup: If you want to sell couches online, you don’t need to compete with IKEA, because IKEA has a different problem that it has to solve.
Think about how one of the biggest companies in the world, Amazon, started by selling only books online in its first four years of business. Amazon dominated a sustainable business that was defensible, which allowed it to grow into other things. Facebook focused on colleges, which was also a defensible strategy.
If you want a heuristic, we look for vertical alignment, where the lifetime value — which we can impact — is $300 million to $800 million. We look for scale and size — the average Ampush client spends $30 million annually on digital media. The last thing we look for is senior-level, strategic buy-in. We want to avoid selling.
Can you offer advice on how startups can gain customers’ senior management level buy-in?
If you want high-quality relationships, you need a warm network. We’re big on using LinkedIn and our Wharton net- work, as well as McKinsey and Morgan Stanley (where we worked).
We have a great client that does subscription content for sports radio and other things, which we met through someone in our community. The client wanted to work with us. We talked to the client’s team for 18 months while they learned more about their business — in particular, how much a customer was worth and how much they were willing to pay for a customer.
We said, “We don’t think this is the right time to engage with this. It won’t set you up for success.” We continued to dialogue until the team understood their business better. So, I think the ability to think long- term and be patient helps.
What role has Wharton played in the success of Ampush?
Wharton played such an integral role in shaping us as people and as entrepreneurs.
First, the education could not be more applicable to what we do every day. We leverage statistics heavily here in our algorithms.
To devise granular budgets for customers’ ad spend, our model uses linear programming and regression modeling to maximize return on ad spend across campaigns, accounts and platforms.
When we started our company in 2009, we quickly ran up $70,000 in credit card debt. We also made a sale of $100,000. Now, we had learned what working capital is, and it becomes real when you present an invoice for $100,000, and the client says it’ll pay you in 45 days. So, we took what we had learned and legitimately went to banks with our invoice, and they lent us working capital.
Then there is the importance of the relationships. Three years out of school, we had good jobs in the finance industry, but with the financial crisis, we decided to start our company. We thought, “What did Wharton give us? Our relationships with each other.” We had come to Wharton during a high school program, were admitted to Wharton undergrad and then roomed together, and even started two enterprises together. Now, we had to commit!
The third way that Wharton has benefited us is through people. Unsurprisingly, our first Ampush employee was a Wharton alum. He was a super smart kid, and he built much of our product. Seven of our first 10 employees were Wharton alumni. Through Wharton, we learned how to recruit and how to motivate people.
How do you motivate your team?
Entrepreneurship is a creative endeavor. The solutions — how we add value to our partners — are not transactional (that is, if we do x, then we’ll get y). The work demands creativity and collaboration. Whether it’s a software problem or a marketing problem, the focus is how to grow the client. We need to foster an environment where our team can take risks, feel comfortable to disagree, and offer ideas regardless of title. This is what gets smart people excited to work here.
We think about that, what sends the right signals and how we can create an environment where everybody thrives. If it ends up with everyone just following our tactical orders, then we’ve failed. People benefit because they learn a ton. The business benefits because you get the power of 100 minds debating in very productive ways, taking risks and ultimately finding answers.
JESSE PUJJI is the Co-Founder and CEO at Ampush. Prior to Ampush, Jesse was an investment professional at Goldman Sachs. In that role, he made $10 million to $50 million investments in public and private companies in the auto, education and new media industries. Before that, Jesse worked as a consultant at McKinsey in New York City and Dubai, focusing on the internet, media, e-commerce and telecom industries. Jesse graduated from The University of Pennsylvania’s Wharton School with a dual concentration in finance and entrepreneurship and a second degree in political science. He was born and raised in St. Louis, Missouri.
NICK SHAH, Prior to Ampush, worked as an investment banker at Morgan Stanley in New York City and Mumbai, advising on a range of deals, from IPOs to M&As, in the media and telecom industries. Nick graduated from The Wharton School with a dual concentration in finance and operations and information management. Nick can be found playing basketball, participating in dance-offs, cheering for the Detroit Pistons and always being positive. He was born and raised just outside of Detroit, Michigan.