Learning From Mistakes: Roy Peleg, CEO of FirstImpression.io (Part 5)

Sramana Mitra: You were doing this full-time? You didn’t have a full-time or part-time job at this point?

Roy Peleg: Right. My sister was looking for a job. I decided to hire her full-time. When she went on her honeymoon, I started to look for someone to replace her and also found our first developer. A month later when it was becoming difficult to manage the developer, I found my CTO.

Sramana Mitra: Were these people taking salaries? How did you find them?

Roy Peleg: I was paying salaries out of my own pocket. I convinced the developer to take a lower salary and gradually increased during the year. He probably got paid 30% to 50% less, but he believed in the idea. I found the CTO, who I consider my co-founder, within a year of starting the company. He got a very basic salary, which was less than the developer’s. I invested about $90,000.

Sramana Mitra: Talk to me about the business validation. You got a few people to pay you $300 to use your technology to improve their monetization. How did you get to a point where you thought that there is a business here? I know this business. It’s very difficult to monetize blogs with advertising. I’m curious to see how this business even gets to any kind of scale.

Roy Peleg: Initially, there was just a handful of clients. Things were running very slowly, much slower than I expected. We decided to apply to an accelerator. That was in mid 2014. The company started in March 2013. We decided to apply and were accepted.

Sramana Mitra: What did you get out of joining this accelerator? What was the key value that they added to your process?

Roy Peleg: They’re based in the Silicon Valley. The entire team flew to Silicon Valley and stayed there for four months. We were six startups in one big house. The idea was for them to introduce us to the US market and get a ton of feedback about what we were doing and how it can be improved, increase sales, and take meaningful steps in terms of business goals. They basically gave us a little bit of money to sustain ourselves there.

Sramana Mitra: What year are we talking now?

Roy Peleg: We are talking 2014. We started the acceleration in August.

Sramana Mitra: What did you learn from this process?

Roy Peleg: It was an amazing experience to be close to your target market. I got to pitch more than a hundred times to various people including investors and potential customers. We understood a lot of things. We understood that the SaaS model would be difficult here and that we should aim for the classic model of revenue share – basically monetizing the ad products that we operate and splitting the revenue with the publisher.

Additionally, we understood the name was quite bad. Back then, we were called AppendAd. After getting the same feedback over and over again that it sounded like a medical product, we rebranded. We are now called FirstImpression.io. While we were there, I got connected to a few people who introduced me to a few people. The business started growing while we were there.

This segment is part 5 in the series : Learning From Mistakes: Roy Peleg, CEO of FirstImpression.io
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