Munich Startup: Who are you and what do you do? Please introduce yourselves!
Andreas Kleofas: Hi, my name is Andreas Kleofas. I’m a co-founder and managing director of Emax digital GmbH, where I primarily concentrate on the development of our analytics. Before we founded the company, I worked for Amazon in various management positions for seven years. I was predominantly responsible for developing global reporting and analysis tools for the Amazon Advertising team. Our work included linking data from the campaigns of major advertisers like Procter & Gamble or Philips with sales and category data. During that time, I also picked up a lot about the problems that brand manufacturers face in this area. In addition to being a founder, I’m now also a mentor for other startups and work as a lecturer at Hochschule München.
Dominik Pietrowski: I’m also a co-founder and managing director of Emax digital, where I’m in charge of marketing & sales and also for customer acquisition. Before that, I worked for Amazon for just under six years. Starting in 2012, I helped build its advertising business in Germany from the Munich office before switching to the New York office in 2016. Andreas and I had already worked together during our time at Amazon on a wide range of projects for brands like Philips, Beiersdorf and Nestlé. We helped brand manufacturers make the right activation and investment decisions in order to be more visible and more successful than their competitors. Before that, I worked as a product manager at L‘Oréal Paris and at Adidas and took care of brand building, ad campaigns, merchandising and sales campaigns – primarily for brick-and-mortar retail back then. As for my education, I completed my business administration studies with a “classic” diploma at the University of Bamberg. In addition to my work for Emax digital, I’m also a mentor for other startups and work as a lecturer for business administration at Hochschule München.
Dimitri Dumonet: I’m Dimitri Dumonet, the third co-founder and chief developer of Emax digital. My job – in a nutshell – is implementing the technological vision of the company. I originally studied environmental engineering, which was when I discovered my passion for technology and programming as a student assistant working on simulations in the field of engineering. I went on to work for various startups as a programmer and was also the first full-time employee at E-bot7. Back then, we were located at the startup accelerator Wayra, which is where I met Andreas and Dominik. They got me so excited about the idea of making something as complex as Amazon simpler for retailers and advertisers that I joined them.
Munich Startup: What problem does your startup solve?
Dominik Pietrowski: With our AI-based reporting and analysis software, we help brand manufacturers optimize online commerce through digitization. In concrete terms, we give them recommendations for action, for example on the right amount to invest in advertising on Amazon. We make it extremely easy to access all of the relevant data in their business, from the sales side of things to marketing measures in Amazon searches or on the demand side platform (DSP). This allows them to plan more precisely, negotiate better with Amazon and to be more successful over the long term as a result.
Andreas Kleofas: The digital association Bitkom most recently found out that just 8 percent of companies use AI – and that isn’t used for planning. These days, however, there’s no way for a company that manufactures products to avoid online retail, and most manufacturers are already investing large sums in sales through Amazon and in promotional activities on the platform. And yet they can only make use of a fraction of the data that is relevant to them, because it’s either too complex for such a short period of time and probably because there’s a lack of the necessary know-how in most cases.
Emax digital: “Agencies and consultants also work with our tool”
Munich Startup: But that’s nothing out of the box!
Dimitri Dumonet: Of course, there are lots of Amazon agencies and service providers, who either provide support as consultants or use AI to optimize bidding for ad display on Amazon. That is correct. But we take things a step further with our technology and offer support on an extremely strategic level. In other words, we answer the question about where a manufacturer should start with their Amazon business (for example, which products should be optimized first) and how much and when they should invest in sponsored ads and DSP. They can do that with the bidding or campaign management tool of their choice.
Dominik Pietrowski: In fact, agencies and consultants also work with our tool and technology because that allows them to offer their customers an advantage: data-based recommendations for action.
Munich Startup: What have been your three biggest challenges so far?
Andreas Kleofas: There are lots of challenges in a startup – and our first funding round certainly was one of them. We started by bootstrapping and wanted to keep that up until we had a stable proof of concept. And it worked. But it required major effort to raise external money from business angels and VCs while running a business. It involves lots of time-consuming discussions and you have to constantly perfect your pitch. It’s a lot of fun, but it can be quite a balancing act to find time for product development, customer acquisition and potential investors.
Dimitri Dumonet: Technologically, we’re very proud of our microservice architecture. We invested a lot of time and effort in developing a scalable system. Every day, the system collects more than 80 million data rows from anything from simple APIs to complex crawlers and saves them in our data lake and data warehouse. In our data lake, we can process the ever-growing amount of data and identify complex correlations and use artificial intelligence to make forecasts. We can then display the detected statements using a business intelligence interface.
Dominik Pietrowski: I would also like to mention hiring. Especially for rapidly growing startups like Emax digital, a team that functions well is essential. It isn’t always easy to get people to notice you alongside so many other fantastic employers in Munich. Since last year, however, we’ve been able to more than double our team to 21 employees. Fortunately, we learned things the hard way at Amazon and know how to set up a good interview process. Having said that, finding the right people always involves a lot of effort. But it’s also clear that the effort was worth it and we’re extremely proud of every member of our team.
“Turnover has doubled and we’re still gaining in momentum”
Munich Startup: How is business going?
Andreas Kleofas: We’re very pleased. In combination with our technology, we currently offer brand manufacturers access to managed services with a focus on Amazon ads. In the future, we want to fully focus on technology – this is where our year-to-date turnover has already doubled and we’re still gaining in momentum.
Dominik Pietrowski: Last year was defined by the corona lockdown, which also had an impact on our customers. Many manufacturers still generate a large portion of their turnover through brick-and-mortar stores. They were closed and Amazon prioritized items that were particularly important during lockdown. As a result, we were also hit by a significant decrease in turnover. That makes us all the more pleased to have been able to focus fully on growth again this year. And our solution has come at just the right time for brand manufacturers. After the shock of lockdown, many have realized how much they depend on brick-and-mortar retail and that others are ahead in the game in online retail. We can help them change that!
Munich Startup: What do you think about Munich as a startup location?
Dimitri Dumonet: Munich is a fantastic location for startups. We started in the Wayra startup community in downtown Munich and immediately connected with the extremely active ecosystem here in the city. Early this year, we moved to Werk1, where we also feel very much at home. Exchanging ideas with different tech startups is very valuable and extremely helpful because everyone is very eager to provide mutual support.
Andreas Kleofas: Even before Emax digital, Munich was already the focal point of life for us with good jobs and networks. The comparatively high rent, however, is difficult for a startup to pull together in the beginning. We founders were able to survive a few meagre months with our savings, but we obviously had to get turnover coming into the company or get investors on board pretty quickly. And, of course, these kinds of costs have an impact on employees’ salaries. As a startup, we can’t pay corporate salaries, but we score points with our candidates with other benefits. That being said, even the most motivated employee needs a roof over their head and that just happens to be more affordable in Berlin. Which is why we’re now more willing to accept employees who only work for us “remotely” than in the beginning.
Dominik Pietrowski: On the other hand, Munich and its surroundings are fantastic, with all kinds of different companies. And that is extremely helpful for sales!
Munich Startup: Hidden champion or shooting star?
Dimitri Dumonet: We’re part of the Munich startup ecosystem at Werk1 near Ostbahnhof and in the Wayra community, the Telefonicá Accelerator. There are so many fantastic startups! Right next to our office, for example, is Tradelink, which is definitely a shooting star to me. They’re shaking up the logistics industry with their digital solution for end-to-end delivery organization and have been really growing since their investment round.
Andreas Kleofas: A hidden champion from my point of view is Bonfire. They’re a young startup, still in the seed phase. The founders have built a digital team platform with a psychological substructure that makes it possible for companies, despite remote work and home offices, to develop a sense of community and work efficiently. That is truly exciting and forward-thinking.