Inside the Web3 Marketing Revolution: Addressable's $13.5M Milestone with Tomer Sharoniby@ishanpandey
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Inside the Web3 Marketing Revolution: Addressable's $13.5M Milestone with Tomer Sharoni

by Ishan Pandey7mFebruary 6th, 2024
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Tomer Sharoni, CEO of Addressable, shares the journey of raising $13.5M led by BITKRAFT and the impact on Web3 growth marketing. Addressable, founded by three friends, leverages big data and AI to tackle Web3's unique challenges, such as user acquisition and retention. This funding will expand their reach, enhance analytics, and ensure Addressable's place in the Web3 ecosystem. Sharoni also discusses overcoming investor skepticism, the technology driving Addressable's success, and the future of Web3 marketing.
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Welcome to another insightful edition of "Behind the Startup." Today, we delve into the fascinating world of Web3 marketing with our special guest, Tomer Sharoni, CEO of Addressable. Following their remarkable $13.5M raise led by BITKRAFT, Addressable stands at the forefront of Web3 growth marketing. We'll explore the intricacies of their journey, the innovative strategies behind their success, and their vision for the future of Web3 marketing.

Addressable's Founders Reveal the Secrets Behind Their $13.5M Success in Exclusive Interview

Ishan Pandey: Hi, Tomer Sharoni, great to have you here for our "Behind the Startup" series. To start with, congratulations on Addressable's successful funding round. Can you walk us through the journey that led to this achievement and how this capital will fuel your future endeavors in Web3 growth marketing?

Tomer Sharoni: Addressable was founded two years ago by 3 friends, Asaf Nadler, Tomer Shlomo, and myself. Our goal was to address the specific needs of Web3 businesses leveraging our expertise in big data and AI. We engaged with over 100 companies through extensive market research, uncovering a common challenge - user acquisition and retention within the Web3 space. In Web3, user interactions are decentralized and anonymous, challenging communication. Traditional communication channels like social media and email remained prevalent across web3 communities, and businesses tried to communicate with new audiences organically in their social channels.

Once they wanted to acquire new users outside the community or retain users who were drifting away from their community, they faced major communication challenges. Recognizing this wide need in the market, we devised a solution to bridge the gap between Web3 audiences and social media through data integration.

Our platform now allows businesses to build and measure advertising campaigns based on users' Web3 activity.

This innovation enables the creation of precise and measurable marketing strategies, a much-needed tool for Web3 businesses. The recent funding round has propelled us forward. We're expanding to new social networks and ad networks, broadening our blockchain integrations, and enhancing our analytics capabilities to include mobile and social network data.

This investment will accelerate our growth and help us become a vital part of the Web3 ecosystem.

Ishan Pandey: Reflecting on Addressable's fundraising journey, what were the key challenges you faced as a founder in convincing investors about the potential of Web3 marketing? How did you address these challenges?

Tomer Sharoni: Convincing investors posed several challenges during our fundraising journey. Firstly, some investors questioned whether Web3 marketing was a distinct category, as it appeared to be an extension of Web2 marketing. They argued that we were still advertising on traditional platforms like social networks and Google. Additionally, the issue of measurement came up. Investors wondered if we were merely a subcategory of marketing, with the same metrics applied.

However, what we emphasized, and what eventually resonated with many investors, was that Web3 marketing is unique. It bridges the gap between Web3, where all the commercial activity happens, and Web2 social networks, where all the communication happens. In Web2 marketing, there was no integration of public data from Web3 – about where people spend, what they do, their preferences, and more.

This wealth of Web3 data remained unconnected to traditional marketing practices. This disconnect was a missed opportunity for companies looking to target and understand Web3 audiences better.

Web3 data is extensive and highly accurate, offering insights into audiences' spending habits, preferences, and interests, which can significantly benefit businesses when utilized correctly.

A second challenge we faced was the preference of many Web3 investors for native Web3 solutions. Addressable, however, takes a unique approach. We work with Web3 companies that want to target Web3 users but do so through Web2 platforms like social media. Some Web3 investors initially viewed this as contradictory to the Web3 ethos. They questioned why we were operating in Web2 channels when our focus was on Web3 users. Our response was that this approach aligns with how businesses currently operate.

To grow their user base and their community, they seek out potential users on social media platforms like Twitter and Reddit, among others, where most potential users hang out. What we provide is a way to go outside the boundaries of the community, and have a precise and sustainable way for businesses to grow, by leveraging Web3 data for targeting. We explained that by helping these companies navigate Web2 channels effectively, we contribute to the growth of the entire Web3 industry.

Ishan Pandey: Addressable's capability to attribute crypto wallet owners across numerous websites is groundbreaking. How does this technology work, and what sets it apart in the crowded field of digital marketing?

Tomer Sharoni: Addressable's technology targets a specific group of internet users - crypto wallet owners, which number in the tens of millions among billions of internet users. Our unique approach involves matching audiences in Web3 and audiences on social networks such as Twitter and Reddit, as well as audiences on programmatic ad networks in the open web and mobile apps. We achieve this by analyzing behavioral patterns, and matching on-chain activities of web3 audience segments to online activities of social networks’ audience segments.

This allows us to connect small, particular segments of Web3 audiences with their counterparts on social media. For example, if you want to target users who trade on a particular decentralized exchange, our technology can help you reach them accurately as a group, while strictly preserving the privacy of individuals. What sets us apart is our ability to bridge Web3 and Web2 data effectively, enabling advertisers to reach their desired audience with precision.

This approach is unique in the crowded digital marketing landscape, as it empowers businesses to tap into the valuable world of Web3 users while leveraging familiar marketing channels.

Ishan Pandey: Addressable's expansion into new ad networks and blockchains suggests a complex technical infrastructure. Can you elaborate on the challenges and solutions in scaling your technology stack to accommodate this growth?

Tomer Sharoni: Expanding into new ad networks and blockchains means handling vast amounts of data and complex audience-building queries. To address these challenges, we've built a cutting-edge infrastructure, leveraging AWS and databases designed for large-scale analytics. We've also implemented efficient data lakes and indexing mechanisms.

Our approach includes edge engineering and AI analytics for new contracts and activities on-chain. This enables us to scale seamlessly as we incorporate more blockchains, new contracts, and social networks. We use AI to identify patterns and automatically label new types of contracts and activities, making our entire stack highly scalable.

Ishan Pandey: The integration of AI and machine learning is pivotal in modern marketing technologies. Can you discuss how Addressable incorporates these technologies to enhance campaign effectiveness and user targeting accuracy?

Tomer Sharoni: Addressable leverages AI and machine learning in two crucial ways. First, we use behavioral matching AI to identify patterns in audience activity across social networks and blockchains. This helps us understand how Addressable's target audiences relate to blockchain activity, enhancing user targeting accuracy.

Second, we utilize several Gen AI models to automatically identify and label every contract, activity, and business on-chain. This automation streamlines our scale and supports adding new businesses and blockchains almost automatically.

Lastly, we employ AI algorithms for ongoing campaign optimization. By analyzing audience response and conversions, we continuously adjust the campaign, removing underperforming segments and adding lookalike segments that resemble high-performing ones. This ensures that our campaigns are consistently effective and efficient.

Ishan Pandey: In the rapidly evolving landscape of Web3, how does Addressable ensure compliance with emerging regulations and privacy concerns, especially when dealing with sensitive user data like crypto wallet information?

Tomer Sharoni: Addressable places a high priority on user privacy, aligning with the privacy-conscious culture of Web3 in 2024. We ensure compliance with regulations like GDPR and SOC2, by never identifying individuals.

Instead, we create and match segments of audiences on-chain and on social media, avoiding the collection of any personally identifiable data. This approach not only meets GDPR requirements but also adheres to strict social network privacy rules, safeguarding user privacy while leveraging the data of Web3.

Ishan Pandey: Addressable has managed a significant number of campaigns. From a technical standpoint, what have been the most challenging aspects of executing these campaigns at scale, and how have you resolved them?

Tomer Sharoni: Managing hundreds of campaigns simultaneously presents several technical challenges. Firstly, integrating with multiple ad networks and standardizing data across various platforms and APIs can be complex.

We've tackled this by ensuring seamless data ingestion and standardization while maintaining low latency.

Another challenge is meeting the demand of companies looking to expand beyond the networks we initially supported. To address this, we had to scale our team and operations faster than originally planned, as the demand for growing businesses in Web3 and deploying marketing budgets across more channels continues to rise.

Tomer Sharoni: We're excited about emerging technologies in wallet-to-wallet communication, the rise of Web3 social media, and the development of native Web3 ad units. These advancements open up new avenues for advertising and attribution, as well as helping smaller networks, websites and creators to benefit from ads in a scalable way. We're also keen on the potential of social logins on Web3 websites, which can enhance our services and eventually lead us towards a Web3-centric advertising ecosystem that's more user-friendly and appealing to our customers. Addressable is poised to adapt and innovate in these evolving Web3 landscapes.

Vested Interest Disclosure: This author is an independent contributor publishing via our brand-as-author program. Be it through direct compensation, media partnerships, or networking, the author has a vested interest in the company/ies mentioned in this story. HackerNoon has reviewed the report for quality, but the claims herein belong to the author. #DYOR