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Q&A: Outbrain CEO & Co-Founder Yaron Galai

Yaron GalaiYaron Galai is CEO and Co-Founder of Outbrain. Previously he founded Quigo, which was sold to Aol in 2007 for a reported $340m. We got personal with Yaron about content personalisation, 'unremitting KPI obsessions' and where publishers should be placing their bets on editorial, product and technology. Briefly, what does Outbrain do and which publishers are you working with in the UK? Outbrain is a content recommendation engine, which is fundamentally about helping users discover interesting Outbraincontent online. It’s developed along similar lines to the way search evolved – with both paid and ‘organic links’ being suggested. We work with Future Publishing and the Express Group amongst others in the UK and a whole raft of publishers including USA Today, Fox, AOL, Conde Nast, MSNBC and The New York Post in the US. In the UK right now we are working with a total of ten premium publishers, and are live on over 70 sites having only been here for nine months. Are content and publishers’ sites becoming more personalised, do you think? And if that’s the case, is there a risk of ‘ghettoising’ content and readers? More and more, this is looking like a one way road. It’s inevitable when the ratio of time available and inventory of content out there has gone completely crazy – the only way to solve that is personalisation. That said, I’m not sure hard news is going to go down the personalisation route – it’s just not going to happen effectively with the data velocity that’s at play, and humans are better at it in this case than algorithms. Opinion and other types of content are a different story though. As for the phenomenon of beehive content consumption – it has always been out there, it’s just that algorithms make it all seem a little scarier. Whereas Fox News, for instance, may be said to be personalised for 20 million people, we personalise for one – and it’s really always been the case that algorithms evolve, and therefore have the opposite effect to ghettoising content. The problem Outbrain is solving, in particular, isn’t in trying to be increasingly relevant to and focused on the individual reader, but rather in trying to be interesting – in other words, by providing good serendipity. Sometimes we’re even criticised for not being relevant enough, because we’re trying to delight the reader, rather than send them down a rabbit hole. What do you think of Flipboard, and would you look to launch a similar service with your ‘content network’? It’s a tempting, but also slippery slope – as a user, I love Flipboard, but as a publisher – they’re disintermediating users, stripping content from ads, and in the long-term, publishers aren’t going to stand for it. By contrast, Outbrain is very publisher-focused. If ever we did something similar to this, it wouldn’t be stripping content away from its source, but rather linking out and driving traffic back to it. If you were leading a large media company right now, what areas would you be focusing your attentions on, both from a commercial and an editorial perspective? News has never actually had a business model based around publishing news. As in print, so we’ve seen on the web – it’s impossible to subsidise. So while news doesn’t appear to be commercially sustainable, the web also brings new forms of value. I’m thinking of sites like IMDB, for instance, with evergreen content, that become the authoritative destination for a particular type of content: everyone links to them, and they represent that particular category – this was never possible in print. Niches shouldn’t be frightening places for publishers. Good, crisp niches have dedicated audiences. I actually think in this regard,  Aol’s previous content strategy was along the right lines – all geared around niches. This is becoming lost now though, with everything being bundled into the Huffington Post. The days of being able to interrupt people are almost over – wherever you look, from skippable TV ads to ad blocker on web browsers, this is the case. Media companies reliant on interruption need to make a change so that their ads feel more like a service. Paid search results are a classic example of this – where Google’s revenue model is effectively based around providing extra relevant, useful links. Replicating that type of magic is what we’re trying to do at Outbrain – our paid content links actually sometimes get a higher click-through rate than the non-paid recommended stories.  Outbrain has accrued about $30m in funding so far – is there any pressure to sell, and what would be the impact of such a sale on your publisher partners? VCs are obviously there to get a good return, and there are 2 or 3 ways of doing that – selling isn’t always the best. Since I sold Quigo to Aol the effect on publishers has been negligible – many are still using it after all this time, and it’s one of  Aol’s  few ad services that has really stood the test of time. We have a panel at our flagship Summit event on 14 October talking about ‘building products for profit’ – something you seem to know a thing or two about! What would be your advice to publishers on where to focus and how to improve their technical/developer/product management functions? As a startup, we’re very KPI-driven. We choose 2 or 3 metrics that will drive the business, and then obsess over them, so there’s day-over-day growth. The thing I’ve noticed for publishers, is that metrics like revenues or page views are often the metrics they use - but these are hardly ever good KPIs to drive any business. From what I’ve seen, they result in a scattergun approach, where it’s all about ‘we need our own Flipboard’, or whatever the latest hyped product of the moment may be around. This results in an extremely winding product roadmap. You need to become fluent with the analytics of the readers that come back. And that will be very specific to the type of business you are in. Publishers can be very different animals, after all, for product decisions, or even their definition of what a product is. For example, all publishers could learn from companies like Demand Media of their unremitting KPI obsession. While the chosen KPI's can lead each publisher to pursue a strategy very different from Demand Media's, they are certainly a great example of focus on a specific publishing philosophy.

Outbrain is an Associate Member of AOP. To get in touch with Outbrain in the UK, contact VP of Business Development Europe Simon Edelstyn