If you work in ad tech, you’ve probably crossed paths with Eric Franchi, co-founder of early ad-net-turned-creative-ad-platform Undertone, somewhere on the conference circuit.
Franchi has set his sights on new endeavors, as the longtime investor and startup adviser revealed late Thursday his last day at Undertone will be June 1.
Franchi helped carry Undertone through its $180 million cash sale to Israeli performance marketing company Perion in December 2015. Outside of that gig, he has dished startup advice to Bravo TV stars/ burgeoning business owners on “Manzo’d With Children.”
Franchi spoke with AdExchanger.
AdExchanger: Why leave ad tech?
ERIC FRANCHI: It’s the right time. That’s the biggest thing. The big constant with my role at Undertone was I supported the company in any way and every way in the 15 years we’ve done this. The company’s in a good place and it felt like the right time given our acquisition by Perion and because our current leadership team is so solid. It felt like the right time for me to step away and dive into the other things I’m interested in.
Will you invest in ad tech in the future?
Absolutely and I’m going to make it my business to help drive it. The big stat from last year is that investment in ad tech was down something like $1 billion between 2015 and 2016 with total deal volume down by a third. Increasingly I feel like this could be the contrarian bet of a career for me.
Every investor likes to throw out that Warren Buffett line, “Be greedy when others are fearful,” but when you see trends showing that the future for digital media and marketing is so gray, and some VCs pulling back somewhat understandably after not having a lot of success with early bets, it feels like this could be an incredible opportunity for someone who has experience in this space.
What tech category is interesting to you?
I look at the $70 billion television market that has to become digital. Consumers are migrating to digital. Thinking about it from the brand lens, I start there.
How can we make great brand experiences in mobile? How can we leverage real identity to have messaging that’s relevant to the consumer? But some of the categories I’m most excited about are areas that will be transformational – artificial intelligence, computer vision. They’ll change digital advertising and marketing.
You’ve been a big proponent for why winter, in fact, is not coming to ad tech. You even created a sharable spreadsheet for the industry about all the deal activity. What spurred this?
When presented with data, it’s a little hard for people to continue parroting the line that some people have been saying for 10 years: that “ad tech is dying” or pick your phrase. It’s absolutely consolidating and the latest data from Luma shows there’s net consolidation across all the companies they look at.
On the other side, there were 16 or 17 nine-figure exits in ad tech last year and so many new companies coming into the space looking at ad tech and mar tech.
If you were to do something differently in your 15 years in ad tech, knowing what you do now, what would it be?
When we started the business, [my co-founder] was 25 and I was 24 and you could start a business with two people and a telephone and fax machine. Those times are over for digital advertising.
We were salespeople and two account executives who left About.com to start a new thing. I don’t think we had the full appreciation for, frankly, how important product and technology would be. We didn’t invest in product, tech and the talent that goes with it until much later. So that – maybe a focus earlier on product and tech, rather than just sales and marketing.
What are the best and worst parts of ad tech?
Best: the people. Folks come into this space because they want to be part of something that’s growing. And its opportunity. The best days of digital advertising are still ahead – $70 billion of TV money will eventually move.
From a negative side? There’s a lot of haters. [laughs] Oftentimes, there are folks who just don’t get the space or love to blame so many things that go wrong on the internet, that at times, if you made this your career and life, it can kind of get to you.
Inquiring Bravolebrity minds want to know, will there be more TV cameos?
[laughs] I have nothing to announce, but never say never.
Interview edited for clarity and length.