Episode 079 - AdStash w/ Douglas Lusted

Welcome to out-of-home insider today's episode is all about dropping out of college. No, just kidding. But it is an origin story that may inspire you to take a chance on yourself. We're joined by Douglas lusted, founder of ad stash technology company that turns any OTV screen and any old business into a revenue generating place-based connected TV, capable of delivering targeted.

With real-time impression measurement, find out how Douglas dropped out of college after winning an idea contest to start one of the fastest growing tech companies in the place-based connected TV category. And if you're looking for other ways to help grow your business, head over to one screen.ai and click get listed in the upper right-hand corner, whether you're on the buy order.

Side of the business, provide technology hardware, or even social media marketing. We want to get you listed in the first free public access directory for out-of-home. So go to one strain.ai right now. And click get listed without further ado. Let's go welcome everybody to the out-of-home insider show the podcast, like no other hosted by the one and only Tim Rowe.

You ready to have some knowledge dropped on. You went to be entertained because nothing's more valuable than food for your brain. So sit back, relax. We're about to dive in as the best industry podcast is the bathroom. Again,

Douglas, thanks so much for being. Thanks, Tim for having me really excited to chat. Yeah, absolutely. It's a, you know, we've heard a lot about ad stash and uh, over the last few months, obviously at one screen and working with y'all and some different projects there, and we've had Brian Fitsgibbons on the show previously from venue X, who is a, obviously a user of the ads.

Platform and the Lincoln device, but you've got a really funny, kind of cool, interesting dropped out of college origin story with how you got into, out of home. Right. But maybe, maybe that's a good place to start is how'd you get into this whole crazy game? Yeah, for sure. Uh, and shout out to Brian from venue X, uh, giving, uh, uh, a quick shout out.

So, um, yeah, I actually, in my first year of university of Waterloo, which is in Canada, Um, kind of like Canada's MIT, it's very computer science focused school. Um, had a pitch competition for $25,000 just who could pitch the best idea. And, uh, at the time I had nothing to lose and, uh, that was a lot of pizza and beer, uh, that I could potentially.

So, um, I ended up winning the pitch competition. It wasn't for exactly what we do today, but it was in the digital, out of home space. We were putting ads on escalators and whatnot. And, um, after winning that pitch, you know, a few investment groups said, Hey, we would, uh, we would fund you, but why escalate? Uh, why don't you just put ads on like screens and easier places?

And I was like, oh, that's a good idea. And so a part of that deal was, you know, Hey, we'll, we'll fund the company, but you got to drop out of school and do this full time. And so, uh, made a quick phone call to mom and dad said, Hey, sorry, go on. And, uh, yeah, I never looked back since I was, uh, almost 10 years ago.

So time flies, but that's, that's how I got all started in this industry. Wow. God bless. That's a, that's a heck of a way to get started. So 10 years ago, it was just in the idea you didn't have a company in college or the thing that you were actively working on, right? This was a, it was a competition, $25,000.

Best idea. This was not a preexisting business. That's correct. Yeah, it was just kind of on a, on a whim. And, uh, you know, I had done some like freelancing, um, just like making websites for family, friends and stuff and doing maybe like a little bit of Google ads where, so I knew the ad industry a bit, you know, I knew what an impression was.

Um, I knew what a CPM was, but there was no business. In fact, I think with the money part. That I think the very first dollar I spent was incorporating the company so I could accept the money. So well, that's a good first step. Take us back to what was the idea with the escalators I'm super interested in what that was.

What was, uh, what was the unique quality of the escalators that you want to include? So, um, I have this idea and I heard this really crazy stat that like a billion people ride in escalator a day. Uh, across the world. I don't know if that's the exact, the exact number, but it's up there. It's really high, especially in like Asia and other places.

So, um, I thought, okay, well, if we could put like ads on the handrails, so when you're going up an escalator, you're holding like either a sticker or a little screen or something, you can have so many impressions. And I actually had a pretty close family friend in the escalator business. Who, um, who would be like, yeah, that's a really cool idea.

We could do that. So that's how, that's how it all, that makes sense. So that is not the business that you're in today since then. You've uh, you've, you've pivoted you've, you've got a hardware element. You've got a, a SAS element. You've got a few different pieces to. Add stash platform. What is it that ad set does specifically?

And then I'd like to get into a little bit more of the conversation around place-based, um, kind of place-based connected TV, if you will, which is, which is really the universe that you play in. Yeah, for sure. So what ad sash does is power and monetize digital signs with advertising. We have solutions to basically activate any digital screen to a moneymaking device.

We have the hardware. So the media player, that powers ads onto the screen and it just connects. Yeah. I have one, I have one it's across from there. It is. All right, Dennis says it a little bit. So it's, I mean, that's about the size of it. Uh, cell phone now, is that the exact, the exact size of a deck of cards?

Interesting. That's okay. So you've got a device, the size of a deck of cards that plugs into any screen with an HTMI. That's correct? Yes. And then we also have a free content management system that's hosted in the cloud so that you can log in and schedule ads or content onto your screen. And that's what makes ad sec so unique is for that content management system, there are no monthly fees it's completely free.

And the reason why is because. It is connected to multiple programmatic SSPs and DSPs. So that they can buy advertising on screens at will. And we take a commission from that advertising. So it's kind of like an ad supported model. And what we realized was a lot of small and medium-sized businesses in north America.

Never really did digital signage because they didn't want that monthly fee. It wasn't really a big priority for them. But now if we can go to be small, medium businesses and say, Hey, here's a way for you to make a new revenue stream. Suddenly digital signage becomes something they want to do. And so, um, the only other element on top of that, and it's a premium fee.

Is, we can also offer audience measurement and analytics. So if you'd like to know how many people are walking by your screen, how long they're there for how many times they've been there before we use a wifi and mobile detecting technology so that you can use that data for whatever purpose you'd like, maybe reporting back to your advertisers, Mac to your building, whoever, and that's, that's built in there.

Okay. So just to make sure I understood and got all that, right. You, if I'm a small business owner, I'm thinking of the coffee shop that I go to, they've got a TV screen in the corner. That's always off. They could get the Lincoln device, the piece of hardware, size of a deck of cards, plug that into their TV and then get a free content management platform that they could use to show their daily specials or show, you know, maybe some content, how the coffee gets made or how it gets roasted.

Um, and then they could additionally monetize that screen. By being plugged into, um, the SSP DSP side of, of ad stashed at dad, get all that about right. Everything. Except it's an ad stash device, LinkedIn access device, the premium analytics I was speaking of before, but yes, everything else you said is exactly right.

Okay, great. So, so then if, if, if I was the small coffee store owner and I've got a couple of TVs that are just sitting there and turned off, or my barbershop to my barbershop, Skyler. Bunch of flat screen TVs and they're, they're generally off. Uh, they could be monetizing those screens by having an ad stash device and just sell it adds to the bakery next door, the, uh, you know, the, the garage across the street.

So there's ways that small local businesses can ultimately monetize the attention that's in their stores through a platform that's. Which is pretty amazing. And then that gives advertisers access to say, I want to advertise in barbershops, or I want to advertise in coffee stores because my audience is there.

That's pretty incredible. And when you talk about the analytics, I think that that's particularly interesting because out of home in general, measurement's always been the big question. How do I know that it's working? So when you're measuring. Folks that are in front of screens inside of places. What are the types of analytics that you're able to detect from one of those devices?

Yeah. So the basic traffic data, so how many phones are within viewing distance of the screen? So let's say you've got a huge screen, but you lock it in a closet unless you're in that. You can't see the screen. So the digits, the devices are calibrated to make sure that we're only counting people who can actually see the screen.

And so the big ones are how many people were there or phones and how long were they there for? And how many times have we seen them before? That's the basic data that we then send to the advertisers. So they know how much to pay or how many impressions their campaign. Well, so, so really we we're able to calculate like a reach and frequency with, I'm guessing it's some sort of dwell time component.

How long they're at this venue or in front of the screen. Are you able to determine that as well? How long that they were potentially exposed to it? Yeah, exactly. And that's something that's very unique to our technology is we don't count how long people are in the venue. We count. How long are they within viewing distance of the screen?

And that's something. Pride ourselves on because a lot of advertisers have a bad taste in their mouth because there'll be paying for a dwell time of like 30 minutes in a building. That's got five floors and the screen is on the third floor. So everybody else who isn't on that floor, they're still counting their dwell time.

When that isn't really the case. It should only be the dwell time of when they actually can see their ad. And that's something that. You know where the whole industry is still working on solving, but we think we've got the solution. Yeah, I think it definitely sounds like a really good place to start from.

So we've got the small business side where I'm a small business owner. I can plug this into any one of my screens or if I have, maybe I'm a restaurant owner, I've got multiple locations right now. They've effectively got their own network. Um, which is pretty incredible. What are the, what are the opportunities or maybe speak to some of the folks that are, are standing up businesses around ad stash?

Because it would seem to me like someone listening to this that's entrepreneurial someone that's listening to this that maybe already has a billboard plant. The next iteration, logically to me is rather than going and selling pre-roll advertising or display advertising, go create a network of digital screens in your market to compliment the billboards that you have and sell it as like hyper-local, place-based connected TV retargeting.

That seems more synergistic than I'm a billboard company. And now I sell connected TV ads that I'm white labeling for. You know, the trade desk or whatever. What, how are, how are, how are the entrepreneurial business owners like a Brian Fitsgibbons from venue X? How are you working with media owners to modernize their place-based network?

Yeah, that's a really great point. And most of our screens today on the platform, you know, we've got over 70,000 now have actually come from what all I call kind of affiliates or resellers, these single entrepreneurs, or maybe businesses that already have screens in place or are looking to put screens in the market.

And, you know, they know somebody with 50 screens, 20 screens, a hundred screens, and this becomes a really good opportunity for them. What we do in that case is we give them a piece of that advertising revenue that flows through. So everybody's on a commission model and it's fair for everybody. Add Sasha only gets paid when we bring advertising, the affiliate only gets paid when the, uh, screen owner themselves or the venue get some advertising money as well.

So it's really a team effort. Um, and we all make money at the same time, which again is very different than a lot of digital signage companies. So we work with individuals helping them, you know, get their first network up and running or, um, get them kind of to start a business and start, uh, installing these devices everywhere.

We also work with like place-based networks that already exist and are just looking to get rid of their CMS fee and are looking to get started in programming. Um, and already have a network of screens out there. We work with them to, um, but that, that seems to be a very good go-to-market strategy for us is working with others rather than going to the small business direct all the time.

Um, so we're, we we're working with digital signage groups, digital signage network, screen manufacturers, kiosk, um, manufacturers instill installers, really anybody who wants some ad revenue. Wow. So here's the killer question, I'm sure. At the beginning of COVID you were able to see within that the, uh, the Lincoln platform dwell times drop off people weren't there, um, and be able to see that pretty much instantaneously.

How, how have you seen the recovery? Are you seeing different patterns today than maybe you did two years ago in, in, in a pre COVID? Oh, yeah. Oh yeah. It was actually pretty scary at the start. I'm not going to lie to you. It was, it was crazy to see the amount of drop-off, but we also saw surges in other locations, like we were in pharmacies, a huge portion of our networks are in pharmacies and medical clinics, which we saw a massive spike for.

Right. Everybody getting checked out by the doctors, everybody doing COVID tests, everybody buying hand sanitizer and toilet paper. So it was kind of interesting to see where a lot of places we lost traffic, we gained traffic. Um, right now traffic is back but not fully. Right. Uh, and it's very, very territorial.

Uh, so like in some places in the us where like a hundred percent there to where we were two years ago, Canada, for example, we still got a lot of COVID restrictions here. So like we're seeing capacity now at like maybe 70%. So it really depends on where in the world you are and what type of venue you're in.

Um, but those that do have the freedom to go out, people are going back out, you know, people really did miss the restaurants, their movies. Um, I know, I sure did. So it's interesting to see that. Yeah, no, I, I very much the same missed all of those things as I'm sure everybody who listened to this listen to this has as connected TV has really grown as a category and as a, as a channel that marketers, especially, you know, speaking of lockdown, uh, we saw a lot of advertisers.

Those ad dollars that they were spending maybe on traditional, out of home, um, into those more connected type of experiences. And place-based connected TV as a category really seems to make a lot of sense. It's something that our CEO, Sam has talked a lot about some stuff I'm sure you think a lot about too.

What are, what are the opportunities for advertisers? Is this the same as the rest of, out of home? How should buyers be thinking about the opportunity to run video creative in a place-based one to few one-to-one setting? How should they be thinking about that part of, out of home as a part of the general mix?

I think it's both really, I mean, we work with out of home agency to only do out of home. And place-based is a core component of that. We also work with a lot of connected TV right now because it is a TV in an indoor environment with a captive audience. I mean, who doesn't want that? They're sort of blending together.

Right? Um, the benefits of, of indoor or digital place-based is that. It's very efficient. And what I mean by that is let's say you're trying to reach, um, young men who are in a health and fitness lifestyle. You could put an ad on a billboard where you think those people live, which would be great. But what you can also do is put that.

Specifically in gyms. So now you're paying for impressions where there's a huge concentration of your target audience in a gym, you know, like 99% of people are your target audience there. Whereas on the billboard, maybe 60% or 50% or 40% of the impressions you're paying for are actually reaching that target audience.

So it's a really, really efficient way to spend your ad dollars and with the amount of reporting that's done now, um, I think advertisers are becoming a lot more familiar and comfortable with that concept. So, um, you know, whether it's an omni-channel DSP and agency direct, there's a lot of benefits to doing indoor versus outdoor.

And I would say if I had to pick one efficiency would probably be. Yeah, I love, I love that you bring that up. I was just talking to a friend about this the other day, that the power of out of home, as great as all the targeting and the measurement things. I think something that's important to keep in that lens, in that purview is, is on target percentage just because that billboard is perfectly targeted or that we can do some sort of deterministic measurement.

What's the. Percentage relative to the effect of ad dollar and using some of those inputs to make good decisions about where should I actually be spending ad budget inefficiency makes a lot of sense to be able to say, Hey, I'm a supplement company. I want to target people that go to gyms in this market because I'm sold at these GNCs.

So let me be inside of gyms in that market and maybe scale up from there. Getting it, getting the brand out in front of the right people. Now I want to reinforce it maybe with the bullets in a and kind of backing it. I love, I love the flexibility that place-based screens give a media plan for exactly that reason.

Um, and in terms of like CPMs, do the CPM is varied by venue. Do they vary by screen type? How, how maybe somebody who hasn't bought this before, how do you think about pricing? Or how does, how do your partners think about. Yeah. So generally what we're seeing is that, um, it varies on, uh, for a variety of reasons.

Um, but overall, generally it's a little cheaper than a big spectacular billboard. Um, and so when you think about, okay, this is more efficient and it's cheaper, it almost becomes a no brainer to include in your media mix. Um, the, now that being said. A lot of it depends on traffic. Right. And it also depends on how specific and audience it is.

For example, if you want to reach like I'm a, I'm a type one diabetic. If you want to reach type one diabetics advertising in just an average medical clinic might not be as efficient for you because maybe one out of a hundred people there are diabetic. But if you were to advertise in specialists, diabetic clinics, Well, suddenly that CPM is going to go way up because you've got a really, really niche audience to find, um, other things that drive it are just overall demand, right?

So like if you're in a brick and mortar retail store at Christmas time, Your CPMs are probably going to be higher than in the middle of the summer, because you know, everybody's trying to convince families to buy your product for the holidays. So to answer your question, it really varies. And it's, what's really cool about programmatic is that the pricing can change in real time.

Like there's lots of algorithms that we're generating to say like, okay, if we've got too many ads, At Christmas time, let's increase the CPM and make them auction over it. And, and that's possible through real-time bidding. Um, so the easiest way to think about it, if you're new to this is it's an auction system.

It's just like. Yeah, I, I love, I love using eBay as the, as the analog for here's how programmatic works. Right? You could go buy it now, right? That would be like a guaranteed direct buy. Or you could set a proxy bid and let E-bay bid for you is, Hey, I'm willing to pay this amount. And coming back to the idea of on target percentage, effective ad dollars, it makes understanding that CPM variability pretty easy to understand if I'm trying to reach a very specific.

With a high degree of certainty and little waste. Well then my on target percentage is going to be higher. Therefore we can certainly rationalize a higher CPM relative to maybe a different format. So I think that that, that makes really good sense. If someone's listening to this, we've got a, uh, uh, Big audience that spans both the supply and the demand side.

Uh, I'm thinking specifically about my mobile truck guys, cause they're always looking for, for new ways to measure. Um, I know billboards aren't a good fit for an ad stash device. Can you measure other things? Could you measure like a mobile led truck or are there other things that the device can be used for now?

Just strictly. I want to keep it to things that don't move inside of brick and mortar. So, uh, if the truck is moving, we're probably not a good fit, but we do have some partners that like station their trucks outside of a football stadium. And like our device would be great for them. Um, but like, uh, actual moving vehicle vehicles were not a good fit, but that being said, we do offer our, our, uh, analytics technology that you can just use our device just for that.

So you don't have to use our media player and everything. You can just buy our analytics and, you know, use it for traffic accounting. Doesn't have to be related to advertising. So we've got like security clients. We've got, um, traffic management companies. Using that technology just to simply track traffic flow.

So that's something that, that we offer and are more than willing to chat about. And then the second, uh, product that we offer that isn't widely talked about as much, but a lot of digital signage companies, um, that have thousands and thousands of screens don't want to replace their existing CMS. So. We call it the ag fash API.

You can just connect to our API. It will connect to your existing content management system, but it will connect you to all of the programmatic partners that we are partnering. And so right now we're partnered with 12 of them and we've got some more on the way, but you integrate with us once you keep your existing technology stack and you're alive on 12 programmatic exchanges.

And why that's so special is because the average programmatic exchange takes a really good developer, like four or five months to integrate with. So if you want to integrate with 10 of them, that's like over three years of. So, what we do is we allow you to save all that time and also save all that costs, paying your software developers to do that and just get money in the door.

Now, what you're giving up for that is, yes, we take a percentage of the revenue, but most people, once they do that analysis are willing to give us a piece of the advertising revenue to get money in the door now and save all that. You would pay a sales rep for it. You would pay a, you know, a finder's fee, a bird dog.

If somebody just walked in with a deal for you. Anyway, it's, it's found money. I like found money and I'm happy to pay for it. Uh, Douglas said if somebody, somebody has heard something here today and they're, they're just chomping at the bit. They want to learn more. Where should they go to learn more about ads?

Go to www dot, add stash.com. Um, we've got lots of contact us buttons everywhere, uh, that, uh, yeah, someone will get back to you quickly. That's the best place to reach us. Awesome. Awesome. Any place that you're most active on social that folks should connect with? Probably LinkedIn. So just look for Douglas lusted on LinkedIn.

Uh, I accept almost everybody. So, uh, hit me up there and, uh, definitely happy to continue the conversation there. Awesome. This has been a lot of fun before I let you go. Let me ask you a couple of questions. You have book guy, your podcast guy, like videos. Where do you go for inspiration education motivation.

I would say I am a accelerator guy. And what I mean by that is 500 startups, which we went through. Y Combinator. They are posting constantly on their blogs and their YouTube channels. What I find like phenomenal business advice that they used to keep to just the companies they invest in now it's really available for anyone.

So I do a lot of, uh, YouTube videos and podcasts, newsletters, you name it doesn't really matter the channel, but I like focusing on those type of groups I find for growing a company they're they're really. Name one, your top point. If you had to say this is the only one I'm going to keep. What's the one that, oh, um, there's a guy named Jason Lemkin.

Um, too, I've met at 500 startups. He's known as the SAS. God, he asked and then strong. Yeah, he's amazing. The blog posts he has on LinkedIn are, are phenomenal. That's one of my favorite Jason Lampkin, the SAS, God on LinkedIn. Check it out. We're closing out 2021 here. What are you most excited for as we close out the year?

It's a great question. I think I am really excited about big. Omni-channel DSP is entering the space. We're hearing a lot of rumors right now. Obviously trade desk has already entered digital out of home, which is phenomenal. Right. You know, they're doing billions of dollars in revenue. We just did a partnership with PubMatic, another really big one in the online space.

And we're in conversations with a lot more. And I think when these, you know, the big boys enter this space, it's going to be great for everyone. And I'm hoping by Q4, they, they jumped right in. So that's what I'm most excited about. We're going to put a pin in it, come back and we'll see how we did on that one.

Douglas, thanks so much for being here. Thanks, Tim really appreciate you having me on. Absolutely. If you found this to be helpful, please share with somebody else who could benefit as always make sure to smash that subscribe button down in the corner, like follow share with all the, uh, all the social contacts and networks and all that stuff you are.

What makes the show gross? Thanks so much for listening to this episode. Douglas ad sash. We'll see. Y'all next time, quarter century. I finally came to my senses. I finally got my hand up on the tinted Benz kid. I see the real grit and my tinted lenses with the dream and the drive, the possibilities endless upfront that send this all the way to Tokyo.