WSOU Leadership with Darrell W. Gunter - Oliver Roup, former Founder and CEO, VigLink

Darrell Gunter: Good morning, Mrs. Durrell Gunter, you're a host for Leadership on WSOU 89.5 FM and streaming on the net at WSOU.net. Well, we are coming to you live from the Affiliate Summit East Conference and we are so pleased to have us on our in-studio guest - if you could call the Marriott Marquee coffee lounge in studio - Mr. Oliver Roup, he is the CEO of VigLink. Did I say that correctly? Oliver Roup: You did. Darrell Gunter: Excellent. Oliver, welcome to the program. Oliver Roup: Thank you very much for having me. Darrell Gunter: Yeah, thank you for interrupting this. I mean, you're very busy at the show. You're running up from 38th Street to get our interview in here today. So, for the benefit of our audience, can you share with us a little bit about your education and background? Oliver Roup: Absolutely. We'll get into VigLink. Sure, no problems. I went to MIT undergrad. I was a computer science major and I stayed there for a Masters degree. I finished in 1999. My first jobs out of college were software engineering jobs. I went to work for Paul Allen for a year and a half at Vulcan. I ultimately joined Microsoft where I stayed for four years. I did a number of things there but most notably I started the team that does TV and movie downloads for the Xbox. And then I left there and went to Harvard Business School. In school, I spent a summer working in venture capital. I spent it at Founders Fund. I actually got to do the SpaceX investment or participate in that investment, which I felt great about. And then, you know, I was looking for a business to start and came up with VigLink in business school. It was actually originally a business plan competition entry and a class project. Darrell Gunter: And so, this led you to found VigLink, but what was it about? Tell us about VigLink, for example. What does VigLink do? Oliver Roup: So, VigLink is a group of technologies that helps publishers monetize their content. Your audience is probably familiar with display advertising, which are the, you know, rectangles around content that look like ads. The insight behind VigLink is that the content itself, actually, the text generates a lot of intent, like people who are interested in purchasing things. So, VigLink makes sure all the products and services and brands you mentioned in your text are linked out to where the products can be bought. Or transactions can happen. And then, if your audience clicks through and buys something, you collect a cut. And VigLink sort of enables all that and we do a lot of clever things to drive as much revenue as possible to the publisher. So, it's a revenue stream in addition to display advertising that most publishers can make use of. Darrell Gunter: So, can you give us an example of an ad that a consumer would see and how VigLink plays that role? Oliver Roup: Absolutely. So, Rodale is a good example of a site we work with. And we have many of them - CNET, all the Rodale properties, all the Meredith properties. Darrell Gunter: Who owns the exercise? Oliver Roup: Yeah, they have Men's Health, Women's Health, Men's Fitness. So, we notice the products they mention or find phrases that, you know, nutritional supplement would be a sort of cheesy example. But we look for, you know, really all sorts of things. And we underline those phrases and link them out to where those items can be bought. And then we do a lot of sort of data analytics and math to figure out what is the link and where can we link it that is most likely to lead to the most revenue for the publisher? And because we represent about 300,000 publishers worldwide- Darrell Gunter: You represent 300,000? Oliver Roup: We do. Yeah, we do. It's a big network. It's about 15 billion pages a month in aggregate. And we have a lot of volume so we can negotiate with the advertisers, we can get better rates, we can create competition amongst them for the traffic. And we do all that as a way to drive up the revenue that the publisher commands. And of course, we take a cut of that as our revenue. Darrell Gunter: So, when you were in business school, how did this idea come about? Oliver Roup: You know, I was intent on starting a business and I actually had a spreadsheet with a number of ideas. I had lunch with a former classmate of mine and we had some discussion and we sort of came up with this idea, which at the time I originally coined as "Bitly meets Commission Junction." I mean, I think your audience knows, but it's two companies that we sort of thought would taste great together. And it was the only one I had on my spreadsheet that I kind of couldn't put a hole in. And I wrote a prototype myself in school and then pitched, actually turned out to be almost 100 investors before someone gave me some money. That man was Josh Kopelman from First Round Capital. Darrell Gunter: I know Josh. Oliver Roup: Yeah, he is a great guy. And, you know, we went from there. Darrell Gunter: Wow. You know, David S. Rose here in New York - I'm not sure if you know him - he has a book just recently about how to work with VCs and angels. And I had him on the show. And he says, technically, you know, it takes about 400 meetings. Oliver Roup: So you got it done in 100. That's interesting. That's not the advice I give entrepreneurs, actually. Like, I think it's usually, you know, 20 or never. I think I was too ignorant to know that and occasionally it does close on the 100th. But I think if you've had 20 meetings and everybody has said no, it's possible something needs to be refined about your pitch. Darrell Gunter: Sure. Very good, very good. And so, VigLink, it has been around how many years now? Oliver Roup: I started in 2009, so just over six years. Darrell Gunter: Six years. And some of your VCs or some of the best - we'll now go through the initials. Oliver Roup: Absolutely. Google Ventures, First Round Capital, Emergence Capital Partners, RRE right here in New York, Foundry Group. And we took some personal money from Reid Hoffman, the founder of LinkedIn, Deep Nishar, another senior LinkedIn guy, the Partovi Brothers, who are great angel investors. We really got a great group of people behind us. Darrell Gunter: And so, from your projection, in terms of where you wanted to be thus far, did it blow your mind? Oliver Roup: Sure. I mean, we're growing. The company's 50 people. You know, we don't sort of release exact figures. But I think continued investment, continued growth in headcount, continued growth in network size - all good external signals that something's going right. And we feel great about where we are. Darrell Gunter: Wonderful, wonderful. And so, in your opinion, why is VigLink a better alternative to your competitors? Oliver Roup: So, there's not a huge number of competitors out there. The more traditional competitors are companies like Vibrant Media or Kontera, who sort of exited the business, and IntelliLinks. They have what used to be called in-text advertising. And your readers might be familiar with when you go to a website and you see a double underline under a keyword and that's super annoying and everybody hates it. Yeah, so that was probably the progenitors of the field. They are in-text, but the way I think about it is they consider the advertiser the customer. So, they say, now that I have the Ford campaign, where can I put it where Ford is willing to pay for it? When we started VigLink, we very consciously flipped the script around and said, let's think of the publisher as the customer, even though the advertiser is the one who pays. And how do you think differently when you take that mindset? The answer is, you say, now that I have this page, what is the right thing to put in it? And so, you have a very different mentality. And so, our product is much less intrusive. There's no display element of any kind. There's no pop-up. It's just an ordinary hyperlink that your readers are totally familiar with. And so, audiences are much more comfortable or even enabled by it. Like, we don't make anything unless someone clicks through and buys something. So, putting useless links in a page is not helpful. Darrell Gunter: And so, basically, every one of your links is far more than what you say? Oliver Roup: Well, I mean, we certainly use software to make them as good as possible. We notice links that are either unclicked or that never convert and we stop inserting those links. So, I certainly wouldn't say we're error-free, but we use software and human beings to really do as well as we possibly can at making the links value-add. For the reader, as measured by, if they click through and buy something, then they took advantage of it and we can measure that. We know that. Darrell Gunter: And so, during - as we were walking up to the table - we were talking briefly about semantic technology. What type of semantic analytics are you utilizing to make this happen? Oliver Roup: So, absolutely, we do pretty sophisticated natural language processing to do what we call commercial reference extraction, which is basically reading text, English text at this point, and identifying phrases that are talking about products, commercial references. It can be brands as well and services sometimes. But what you want to do is you want to underline a link in the way that a human being would. So, again, with these double-underlined guys, you'll read a page and the single word "security" will be underlined. And no human being ever thinks like, "God, I was wondering what security meant. And now, the presence of this link allows me to find out." We try to link in a way that human beings would. And, in fact, we created an early reference set of human-annotated texts that we use to compare our software against human performance. So, we know we're getting better because we can measure against what human beings did when you paid them to underline the right things in text. Darrell Gunter: So, give an example. Are you able to determine if a word is - learning is talking about - Value is C versus Value as part of the actress? Oliver Roup: Certainly. I mean, a more common example is like Amazon, the River, and Amazon, the store. Darrell Gunter: That's right. Oliver Roup: You know, that absolutely. Ford versus the Jordan River. Right. So, there's a lot of clues there. One is the general topic of the site. You know, we can both see what's declared, like what they say they're about, and then we can also look at the words in their text and try to understand. You know, automotive sites tend to have words like carburetor and exhaust and muffler and piston. And fashion sites have very different words, right? So, there's nothing worse than underlining a word on a fashion site and linking it to an automotive offer. What's interesting is the bar for publishers, the ratio of money to screw-ups is different than you think. Like, you have to be giving them really quite a lot of money before they can say, "Hey man, you screwed up this time, but it's okay, I'm going to keep you around." You know, you really have to be careful not to link the wrong thing. And, you know, you have to get it right the overwhelming percentage of the time or the publisher moves on. So, you know, we've obviously built up that network with some real endurance over time. And, you know, trial and error and hard knocks. But, you know, at this point, it's a real asset. I mean, you know, we have a big network that publishers have used us for years. We've got real - we're definitely moving more mainstream in terms of what kinds of publishers use us. You know, the sort of New York traditional media crowd, like, you know, Meredith and Rodale, a few years ago would not have worked with us and today they do. Darrell Gunter: Wow, excellent. And, there's been some talk about semantic advertising. There's been some folks that have tried. I haven't seen any clear winners yet in that area. Do you foresee that as something that you will expand to do or a competitor? Or, is just that your way - your business model is just better. Oliver Roup: It's a - I might call that a false dichotomy, right? I'm not sure that is actually the choice we face. I think one of the neat things about VigLink is we don't have to compete with the display advertising guys, right? So, you know, there's probably 50 billion in investment that has happened in the display advertising industry. And, I don't have to convince the publisher like, "Hey, ditch what you're doing in display and work with me instead." That's a tough sale. They're, you know, multi-billion dollar corporations and they're dealing with differences in yield of, you know, hundreds of a percent or, you know, thousands of a percent. We say, look, keep doing whatever you're doing in display. We work in the text. So, it's an easier sale because we say, "Yeah, yeah, do that and do what we do, too." I'm going to take a guess at what you mean by semantic advertising. It's maybe another word for contextual advertising where we say, the ad we put next to the text needs to match what the text is about. So, we actually have a really good understanding of what text is about. It's definitely state of the art from a natural language processing standpoint. So, we can certainly give signals as this content is actually about not just automotive broadly, but specific SKUs. And so, we have a number of partners and technologies we're working on on that front. I don't know if we need to announce, but that data is very valuable. Darrell Gunter: Excellent. Excellent. Excellent. And let's talk about your team. How would they view your leadership style? Oliver Roup: That's a good question. I think... You know, I'm definitely a technically minded person. I have an engineering background. And so, I think definitely I come at the problem from a technical standpoint. You know, background in engineering and product and probably a little weaker on the marketing side. You know, I think they would say that I don't manage well people who need sort of very specific management. You know, I think if I'm giving someone a to-do list and saying, "Do this and then do that," you know, that doesn't work well for me at all. One of my sort of managing, you know, sayings that I've picked up is, "Missions, not tasks," right? So, I don't want to give people a task. I want to give them a mission and let them figure out the tasks or the, you know, the group of tasks. Definitely over the years have tried to become, you know, much more quantitatively metric-like. So, everything we're working on has some numerical measure associated with it and you can measure progress against it. I'd say also definitely, you know, have stepped into different disciplines to understand. But one of the key skills of the CEO is to let your people do their thing, right? I think if you step in and help out the sales person or the product person, there's some degree of like, "Hey, man, if you want to do this, why don't you do it? My job gets a lot easier," right? I think enabling your team to feel like you trust them and it's theirs and they get to make the call and you can, you know, advise and inform - you know, that's the style I try to maintain. Certainly, San Francisco at this point is, you know, an employees' market in the sense that for top people, there are many more jobs than employees. And so, you know, you really have to work hard to have an environment that's positive and engaging and, you know, that you're attacking the opportunity with gusto because there's plenty of other things that all our people could be doing. Darrell Gunter: How would you describe the culture at VigLink? Oliver Roup: It's very - I think a lot of people say this, but we have a sort of - pardon my French - no assholes policy. And I think... People are down to earth, really nice. Yeah, you know, we do, there are no walls or cubicle walls. Yeah, it's totally open. You know, a lot of very smart people. Although maybe this is a contrast with the rest of Silicon Valley. One is, we don't have the, you know, foosball, Red Bull, pizza-fueled environment, right? I think that's quite common in Silicon Valley where you hire very young people and try to work them around the clock. And we try to say, look, like, we don't have a foosball table here because at night we go home, you know, some of us have families. So, I'd say that's a bit of a contrast with the rest of the valley. We also, obviously, look, we're a software company. The engineering is the core of what we do. But it's not the only thing we do, right? I feel like a lot of Silicon Valley companies basically say engineering is the only thing that matters and everyone else is a cost center. And that's just not true, right? Sales is critical, marketing is critical. You know, real... One of the interesting things about VigLink is the business was very financially based from day one. Like, it is a monetization technology. So, there's no version of it that's like, "Hey, we're succeeding but not making any money," right? It doesn't work that way. So, because we were so revenue-focused, sales mattered from day one, products, you know, all the disciplines matter. Darrell Gunter: So, how do you... You sound like you're setting yourself apart from the other companies in Silicon Valley with your culture. What type of onboarding process do you utilize to, you know, reinforce that culture? Oliver Roup: Right. Well, I'd say we try to - I don't want to say we... Like, you're right. I name some ways in which we are different than others because I think when you say, "How do you characterize your culture?" you say, like, "What is different about your culture than everyone else's culture?" I think as far as our onboarding - so, we sat down and talked very carefully about our values a few years ago. So, the VigLink values are: Dare, Overcome, Challenge, Collaborate, and Play. Darrell Gunter: Love that. Oliver Roup: Yeah, and every person in the company can name those to you. And we think very hard about when we hire someone, "Hey, is this someone who will dare? Is this someone I can play with?" And I think that affects everything we do. You know, Overcome is you always have 20 units of work and 10 units of resource and how do you get it done. So, you know, as far as onboarding, you know, we have a dedication to speed. One of the things is all your paperwork is filled out before you arrive and in fact we mail you your laptop ahead of time and say, you know, come on day one ready to work. You know, we don't want to see people spending the first day setting up their laptop because there's work to be done. We have a small HR team that sort of helps with, here's where you sit, here's where you go. We have a culture buddy system where everyone gets paired with someone who's been at the company a while to sort of introduce them to people and make sure they're not like sitting alone at lunch. You know, it's a real warm culture. Darrell Gunter: It feels very holistic, if you will. Making sure that everyone is involved. Oliver Roup: Yeah, it's really - we want it to be a fun place to work. We want people to understand what the work they're doing is for and why it's exciting. We want it to be fun while you're there, the environment, the physical environment is very pleasant. But not over the top, right? Like we - I think there's a lot of culture of waste in Silicon Valley, you know, where people have rooms that are decked out and, you know, sort of themes. We were never financed that way and we don't sort of think that way. We try to be, you know, nice but frugal. We don't blow money on crazy stuff. Darrell Gunter: Wow, outstanding. Thank you. So your leadership style follows your culture. It just sounds like it's a very respectful culture. Oliver Roup: I'm sure you guys could blow up some things. No, I think that's true. This is so refreshing to hear that folks - oh, it's time to go home. Time to spend time with family. Darrell Gunter: Right. Oliver Roup: Yeah, I just think it's got to be sustainable. You know, and it's funny that I keep sort of talking about things as in contrast to others. But I think that is probably a good way to talk about it. A lot of Silicon Valley seems to be competing for the same person, right? They want the person who just graduated from Stanford CS degree and is ready to work all night and is, you know, got nothing else going on in their life other than the startup. And I think not only does that lead to an undiverse workforce, but it's just, it's very - if you're competing for the exact same people as everyone else is competing for, prices are crazy, supply is crazy. So I think saying, you know, the pool isn't necessarily restricted to people who graduated from Stanford in the last five years. You know, people in their, you know, in their 40s and 50s who, you know, have families and have been around a while, like, you know, those people are great too. Darrell Gunter: It's a pleasure. Oliver Roup: Yeah, I mean, you know, I think when you're competing for talent and it really is a competition, it helps to be, you know, mining from a larger pool than everyone else. And we do consciously think about that. Darrell Gunter: Absolutely. So what advice would you give to a young entrepreneur who wants to start their business? Some lessons learned, things that you learned coming out of Harvard? Oliver Roup: It's funny. It's like the last phrase there, the "coming out of Harvard" part, I think definitely sort of cuts it narrow. I would say it's not necessary to go to business school to be an entrepreneur. I think, you know, it's suitable for some businesses and not for others or less so for others. I would say, I think certainly when I was younger, I imagined that as you get older, you get more skills and more experience and more connections. And so you only sort of become better as a potential CEO. I'd say, well, all that is true. There's also a downward trend, right? Spend goes up, your commitments to things outside of work goes up, your ability to see things with fresh eyes goes down. And so those lines cross at some point. And so I'd say, if you're interested in being an entrepreneur, don't fall for the like, "Well, let me go do this other thing for five years first and then I'll go be an entrepreneur." Just go do it. I think that I would definitely recommend getting a co-founder and I do not have one. And I think that is a big mistake. You know, let me be clear. The wrong co-founder is total kryptonite, destroys a company. Darrell Gunter: Did you read the book The Founder's Dilemmas? Oliver Roup: I was actually a student of Noam Wasserman. Darrell Gunter: Get out! Oliver Roup: Yeah, absolutely. Yeah. I recommend that book to everyone I talk to who wants to be in business with someone. Darrell Gunter: Yeah. You know, the entrepreneur or corporate entrepreneur. Oliver Roup: He's fabulous. He's been a mentor to me personally. You know, he's really great. I think, you know, I explored it with a co-founder early on. It didn't work out. And I was, to be honest, a little sort of pissed about it. And I said, you know, I can do this on my own. I'd say that's a mistake. I think you underestimate the sort of isolation of working alone. You underestimate - you know, I mean, First Round Capital actually just put out a data set where they've had 10 years of pitches. And they've looked at which ones they funded and which ones have done well. And they actually put a numerical percentage on how much better pairs do than solo founders. And it's substantial. I mean, I can't remember the exact number, but it matters a lot. Darrell Gunter: Wow. That's great. That's great. And so, you know, with public figures, personalities, is there a person in leadership that you might steal from - you might say, "Right, I might emulate this. I like that particular aspect." Oliver Roup: Right. I'm a big fan of Elon Musk. You know, I hear, frankly, he's pretty hard to work for. So, you know, I don't think I am. I'm not as smart as him, first of all. And I don't emulate him in at least, you know, legend would have it that he can be tough to work for. But I do think the importance of a big vision. You know, he could have pitched SpaceX as like, "Yeah, we're going to build cheaper rockets than the other guy and we'll gain market share in the national reconnaissance market." But instead, he said our job is to go to Mars, right? Or to make humans a multi-planetary species. Like, that inspires, right? And so anyone who cares about aerospace goes to work at SpaceX if they can, because like, who doesn't want to work on that, right? You know, I think, you know, the importance of a big mission, of talking boldly, of really going for it. You know, I'm impressed by that. I think, I mean, his risk tolerance dramatically exceeds, I'd say, most entrepreneurs. I mean, he really, you know, put it all on the line. And in a way that I think if he keeps behaving that way, he will ultimately go bankrupt one day, because you just can't do all-in bets for your whole life and not lose them at some point. But, you know, he's certainly doing well so far. And man, it's fun to watch. So I'm definitely a big fan of him. And he attracts amazing people. I mean, I spent some time with Gwynne Shotwell, who's the president there. And she's just a phenomenally inspiring woman. And I think a good pair to him, where he sort of makes big promises. And I think she actually makes them happen. I'm an outsider, right? I don't want to say I speak for those guys at all. I haven't talked to them in years. Darrell Gunter: Not at all. Yeah, but from - I read the biography. And I was surprised. So here we are. We're at the Affiliate Summit East. Did you achieve your objectives here? Was it what you expected in regards to helping you to continue to build the brand and the business of VigLink? Oliver Roup: Yeah. I mean, I was a speaker. I was invited to be a speaker here. And I think an opportunity to address, you know, the crowd is always worthwhile. I think when people in the industry think about VigLink, you know, having said, "Oh, yeah, I heard Oliver talk. And he seems like a credible figure." I think that helps us a lot. I'm also on the board of the Performance Marketing Association. And we had our board meeting while I was here. And you know, we use the opportunity to meet with customers, publishers, potential employees in New York while we're here. So I live in San Francisco. I get out here probably once a quarter. So this is a good excuse to come out. You know, so I come to Affiliate Summit every year. Quite often I get to speak and I meet people I know. I would say to your audience, you know, be sparing with the networking and trade show spend and time and energy. I'd say, you know, if you can sell a customer, that's probably time better spent than networking. Darrell Gunter: Next one. As you know, Seton Hall has a Stillman School of Business. And so there is a Seton Hall here, there's a Wolf pack. If there were two books that you could recommend for them to read - not just in being a leader or being a CEO, but just being a business person. Oliver Roup: Yeah, but just being a good person. Darrell Gunter: Okay. Oliver Roup: So I recently read "The Hard Thing About Hard Things" by Ben Horowitz. A great book. He's an interesting guy, you know, very into hip hop, you know, which is probably unusual for someone in his demo, right? And authentically, I think, you know, it doesn't seem like bullshit. And he really, you know, he got Opsware through some really tough times. And, you know, I think speaks realistically about what's challenging. I think it's very tempting for business leaders to tell the story of, like, "How I knew it the whole time. And I'm such a genius." And I think that's not true. There's a lot of luck involved. And, man, you know, every success I know has always been - even the ones that succeed, there's a lot of crazy stuff going on inside. And there are periods. So he coins the term, the WFIO, the "We're F***ed It's Over" moment, that entrepreneurs, you know, feel - hopefully not all the time, but certainly do feel. So I think that's a great book. What's another great one? I mean, I recently read "Zero to One," which is based on Peter Thiel's lecture notes from Stanford. I actually think the lecture notes are better than the book, but I think, I mean, it's just required reading. Like, I think the way he structures every startup must have a secret, right, which is not like nobody else knows, but a thing you believe that others don't believe, which is what gives you your advantage, and that others won't believe until it's too late for them to copy you. So, VigLink's secret is that individual ordinary hyperlinks in text have much more economic value than is commonly believed. And I think that led us down the path we're on. So, I think, you know, when your audience is thinking, "I'm going to start a business," - what is your secret, right? And it's important to frame it, right? It's not a literal secret. It's just something you know to be true, which few others agree with you on. And if you can come up with something solid there, there's a chance you have a defensible business, you know, that can be economically valuable. Darrell Gunter: This is great. This is great. We're out of time. Ladies and gentlemen, we are here with Mr. Oliver Roup, the CEO of VigLink. I want to thank you for coming on the show. Oliver Roup: Hey, thank you very much for having me. Darrell Gunter: This is Darrell Gunter, your host for Leadership, and streaming on the net at WSOU.net. Have a great weekend. And remember, leadership begins with you.