New York Angels is Investing in the AI Companies that are Revolutionizing Marketing 

This transcript has been AI generated. Please excuse any typos.

AI is reshaping every industry, of course, but few are as ripe for reinvention as advertising. It’s always been a mix of creativity and manpower, and that can make for a slow and expensive human-heavy combination. Today, on this New York Angels edition of the Angel Nest, we sit down with New York Angels member Mike Jacobs and Adlyse’s founder Anna Stapura, whose company is building an AI-driven performance marketing platform especially for direct response advertisers.

They’re seeing huge gains in efficiency, and that will only accelerate as agentic systems take hold. Welcome back. I’m David Hemenway.

I’m a five-time founder and a member of the New York Angels, where we fund and mentor great young companies. We’re joined now by Anna Stapura, founder of Adlyse, who is in Silicon Valley, and New York Angels member Mike Jacobs, an investor and growth leader. Mike and I are here in New York.

Anna is a repeat founder with deep experience across AI and marketing, now scaling her third company. And full disclosure, Mike helped AI draft parts of this introduction, which seems appropriate given our topic today. Thanks for your help, Mike.

And welcome to the Angel Nest writing crew. Thank you for having us. Thank you so much.

Anna, let’s define some terms first. What is performance marketing as opposed to any other kind of marketing, and how are you using AI to actually improve that process? Sure. Thank you so much for the question.

So, performance marketing is something that touches advertising, paid advertising, what we can measure, right? So, in this case, everything that connects to the dollars that we invest into getting some returns, and also the main metric there is the return of ad spend. I would be talking about that today a lot. So, that’s the part of marketing, which calls performance marketing.

So, is this direct response? Is this for someone who is selling something and they can measure the performance by the number of orders they get in? It’s not necessarily only for selling some goods. It’s also for the services and everything else, because like every business is selling something, right? So, and this is a way how we can get more people involved, get more people actually know about us, maybe even purchased from the first attempt, or maybe they would just know about this company or these products and later they would convert. And how is AI helping you make that more efficient? Yeah.

So, like some backstory that nine years ago, I was also a performance marketer back to Amsterdam. I was working in one of the agency and we set up campaigns across Meta, Google, and any other advertising platforms. And we used to do it mainly, like clicking buttons, trying to change something in order to improve the efficiency and improve the results.

Because in the end of the day, if you rely only on the algorithms of advertising platforms, you’re kind of leave a lot of money on the table. Because of course, no one is interested to give you advertising as cheap as possible, right? So, there’s like always been a tension between those two parties of the relationship between businesses and between like advertising platforms. It’s always like that.

And in order to maintain that tension, the whole industry was created and the industry named performance marketing management. Yeah. Today, like actually this year, the advertising would cross one trillion for the first time in history.

And about 15% of that is actually additional budget, which is spent for performance marketing management. Mike, you spent your career scaling growth systems and now you’re an investor in the space. What did you see in Anna and Adlyse that really wanted to make you get involved? So, I actually started early in my career as a performance marketer.

I started one of the first agencies way back in the aughts, as we called it. But ultimately, I realized the truth of the adage that a lot of VCs say, you don’t invest in ideas, you invest in founders. And it’s really what Anna brings to the table, her dynamic nature, her ability to see around the curve, but also act, right? Act with the boldness that sometimes is required at the startup stage.

For instance, she happened to have lost one of her co-founders due to some visa issues. And she turned that equity opportunity for some of the invested into an acquisition. That took a drive that I personally don’t have, but I absolutely value in founders.

So, basically, proof in the pudding here. Yeah, you’re betting on the jockey, not the horse, necessarily. I’m sure.

You have to have this piece of lemon, you know, make that lemonade. Yeah. We can sit there and calculate and assess how it took action.

It takes a certain personality and strength and a confidence to pick the 80-20 correct approach and move for it. That’s something a founder needs to do at this stage. Yeah.

My experience in angel investing is that at the very early stage, sometimes we spend a lot of time trying to understand the unknowable. This is an evolving journey, and for sure, it’s going to change. So, you’re really investing in the judgment of the founder.

I mean, you know, we have this thing called analysis paralysis, where we can stare at the number too long and not do a thing. What you need is a leader, a big L leader to push through and make decisions even when it’s a cloudy set of debt. And it seems that you are catching the wave here because there is so much more performance marketing, so much more marketing that is trackable, where, you know, advertisers can figure out the ROI rather than what we used to call brand marketing.

Yeah. So, I mean, on that, I do believe in the full funnel, right? Ultimately, you need to not just try to harvest demand, as we call it in performance marketing. You actually have to seed it too.

You have to build either a category or your own brand and do some educating. That’s still an important part of the mix. That being said, meta, as one example, has been trying to work its way up the funnel.

The fact is, a lot of brand advertising ends up in meta or YouTube, or some of them, what are traditionally thought of as slightly more performance channels. It’s just a different set of metrics you’re tracking. So, you know, not to spoil too much, I think we can eventually get there with the product, but you are talking about moving what we call consideration or education.

It’s a slightly different metric than the sale itself. But ultimately, all of these things, technology, AI, and a smart model can actually help us with, but stay tuned for future versions of the product. Yeah.

Innovations are happening every day. Anna, take us through a use case, if you would, about how your technology helped the client become more efficient. Yeah.

So, imagine like the old way of doing it is like when we have performance marketing team, and usually they actually go to different campaigns and they start clicking the buttons, trying to understand what’s actually working, what’s not, and why, and then start acting towards optimizing it, right? Because before, without analysis, you would be not able to optimize anything. And now with AI, of course, it’s possible in just a few seconds instead of hours. And plus, like the main problem is delayed optimization due to manual efforts.

Like humans cannot work 24 seven, it’s okay, right? And also like because of complexity of different ad campaigns, how many AB tests and creatives inside of each ad platform. And imagine if some business wants and needs to be advertised across four or five different platforms. So it takes a lot of different things to think about.

So in the human brain, it’s like, it would be not possible to analyze everything. So the alternative, which existed before we started the company was actually to have as many tools as possible. And like, then it turns out that performance marketers have to sit in front of different 10, 20 different dashboards and still doing things manually, but now like not in one platform across different.

And I was thinking like, okay, it should be the easier way to do that. It should be something else. And what if the future would look like where the whole performance marketing could be executed by AI, not only like telling you what’s working, what’s not, but executed.

So in here, we are talking about like completely different level of AI. It’s not about just the AI recommendations. It’s about agentic workforce that can work fully for you with a much better result.

And if I could add a little, what I would say is that as much as a lot of the platforms are adding tools, right? Adding lots of optimizations, right? Mark Zuckerberg talked about this, right? You’re just going to put in what you need and we’re going to get it done for you. But that assumes that the algorithms are all working for you. Ultimately, these are for-profit businesses.

I don’t hold it against them, but they’re trying to maximize what they can charge for every individual ad impression. You need, and this has been shown in history, you need someone to look out for you, even if it’s that extra two, three, four, 5% efficiency that can be gained. You need somebody working on your behalf, especially across platforms.

Every platform wants to take credit for the sale that they all happen to see, but ultimately it took a certain combination of touches from Google and Meta and Pinterest to get there. So, you know, building something out that works for the advertiser and their own goals, which can be a little different than platform goals, which is pretty essential here, especially working across many platforms. Yeah.

So Anna, are you working primarily with clients directly or are you working with agencies or both? We understand that actually our product best hits performance marketing teams and those teams could be inside of agencies or inside of brands. And both of them are like getting a lot of value, but I can tell you what they value the most. The agencies value the most.

It’s like the margins improvements because of course they can achieve much more in business terms with less resources, human resources, right? And plus they can deliver better quality for brands. If we talk about brands, then the main goal for them is to get better advertising companies, like more efficient, higher ROAS, redistributed budget, which we find out is a waste and put something that’s working for sure. And yeah.

And in fact, like adding to the Mike point is that we don’t look at the recommendations of the ad platforms because we don’t want to look biased. So we always find our own patterns. Also we have our own reasoning model, how we educated to act.

So that’s also another point, like why we so much standing for the business, not for the other And I’ll add a word that I think this offers it’s leverage, right? Ultimately you have some great performance marketing teams and agencies and brands. This extends their ability to take their knowledge and actually go further with it, right? You can tune the skills. You can build custom within the platform, but this ability to basically take the talent that you have, especially at a senior level at an agency or a brand and extend that through a team that’s very powerful.

So it’s not about replacing necessarily. It’s about extending what can be done, which to me is the magic of AI. So now you have had several startups before, so this is not your first company.

What have you learned about utilizing the value add from investors like Mike that is helping you grow? So, yes, it’s a good question. It’s a lot of value could be given by investors, especially if they’re from the industry. And for me, the main goal for the company and my main focus as a CEO is actually people.

It’s not even AI because I do believe if we collect the A players, the best people, the world-class people in the team, the company will succeed for sure. For example, for instance, one of New York Angels investor, I asked recently to go on the reference call with other investors. And it was like, no questions asked.

Just, yes, sure. What else? And that’s one thing. Another thing, I know that if I need to ask anything, for example, to Mike, I always ask any type of questions like, oh, what do you think about this? Any advice on this? Anything here? And he’s always there.

He’s always there for us. Sometimes it’s like, oh, it’s already too much help. I mean, we can accept as much as you can give, but sometimes it’s like, okay, I didn’t know that it could be possible to get so much help from people.

And yes, that’s what I really like and really appreciate. Well, that’s great. That’s what we’re here for.

Mike, I know you do a lot of work developing business leaders and helping them get to the next level. Is leadership your most important consideration when you’re looking at investments? 100%. I mean, ultimately, um, you know, especially in the life of a startup, there’s like going to be pivots, tweaks all the way and getting the person that not only knows how to navigate those, but bring a team along with them.

I mean, big leadership isn’t just decision-making. It’s a key part, but it’s also, I like to call it vision and enrolling a team and bringing them in, not only to execute, but be just as excited about it. That’s thing one.

If you don’t have that, I don’t really think you have a company. Let me ask you what might be a controversial question. Is there any downside to AI in the advertising and marketing industry? Is it all going to be upside? Is this a, a world where everybody becomes so much more efficient, accomplishes more and, and earns more than ever before once they adjust? Of course.

Can I take a swing? Sure. Sure. All right.

So what I look at it is so I only, because I’ve been, I’ve been thinking about this a ton. So overall efficiency is great, but ultimately us as marketers, what are we doing? We’re telling a story about our brand. Certainly we can optimize at the bottom end, but to me, things like brand positioning and what are you and your differentiation is important as ever.

So we can prompt the tools to optimize the thing, but knowing what you are and what you sell and all of that, you cannot outsource an algorithm. So to me from an execution layer, from a strategy, you know, help layer from an analysis layer, amazing, but ultimately you still need to know what you are as a company and what you’re trying to accomplish. And as a marketer, you have to talk about your, be able to talk about your differentiators without that, what is the model going to tune to? So it’s big, you know, garbage in garbage out.

So yes, we can all optimize to what I joke is the five C’s, right? You know, cats, conflict, cleavage, car crashes, but ultimately that’s just faster optimizing to the average. What we as marketers need to do is understand the actual strategy over the top. What are we trying to do? And then AI is an incredible tool to get there.

The downside is when people try to outsource that first part. You and I have both been in the advertising business long enough to remember when one of the founders of the ad business said that 50% of your advertising is wasted, but you don’t know which 50%. And I have a feeling now we know, and it might be more than 50%.

Is that good overall for advertising or is advertising going to be so precise that it becomes smaller? I mean, I think we’ve gotten this precision for sure, but in some ways it’s a false precision, right? To the point of like, if all we do is count the sales that came through that week, we’re going to over-index to the hardest, right? Until we’ve actually rewired folks’ brains and we can actually watch them and understand when did they actually make the decision. So what I think is we’ve probably over-indexed a little to performance marketing. We have to understand like, how do you actually change behavior? Anna Stepora from Adlyse, Mike Jacobs, New York Angels member, thanks so much for joining us today.

Thanks for having us, David. Pleasure. You could learn more about joining the New York Angels or applying for funding for your startup at newyorkangels.com. And you can hear more episodes and reach me at theangelnest.com. A reminder that we don’t make or recommend investments at the Angel Nest.

And this podcast is for informational purposes only. We produce the Angel Nest from New York City, the home of the New York Angels and the media capital of the world. Thanks to help from Rob Higley and David Newhoff, Ken Carberry at the controls.

I’m David Hemenway. Thanks for tuning in. We’ll see you next time..