Understanding the Benefits of First Party Data
Understanding the Benefits of First Party Data
In this episode of The Faces of Business, our guest speaker was David Finkelstein. With over 25 years of internet business experience, David is an internet pioneer and tech entrepreneur. David Finkelstein is the Co-Founder and CEO of BDEX. BDEX is a Data Exchange Platform (DXP), tracking billions of data signals in real-time from dozens of sources. The BDEX platform uses this data to give customers real time data on their existing and potential customers.
The benefits of first-party data were discussed in this episode by Damon Pistulka and David. Understanding the advantages of first-party data is a topic that many businesspeople don’t understand the importance of knowing about it.
First, Damon asked David, Tell us about your background and history, and how you got to where you are now.
Download our free business valuation guide here to understand more about business valuations and view our business valuation FAQs to answer the most common valuation questions.
David begins by stating that in 1994 when the Internet was not yet available, you could only use AOL and Prodigy. So, after using the internet in college, you couldn’t go back to using something like AOL. As a result, that’s how I got started with my own business. I’ve always had a hankering for business, and I started it in a small room in his office building, with just one computer and a bunch of modems hanging off of it.
Damon kept the conversation going by asking him to give us a quick rundown of what first-party data was all about.
David talks about his setup. The data you own about your customers is referred to as first-party data. Many businesses use it to figure out which of their own products they can market to their current customers. But how do you use that to attract new clients? That is the problem we are asking the industry to solve. As a result, our most recent product, the Omni IQ machine learning products, accomplishes precisely that. It’s also creating seated audiences based on your first-party data so you can find more people. People who have previously purchased from you.
Do you want to know if your business is ready for your exit or what you should do to prepare? Learn this and more with our business exit assessment here.
Damon also added that there are some changes for people who aren’t aware that have occurred in the recent past with Apple and some privacy changes, as well as the upcoming things that Google or our Google will do with cookies.
Damon then asked David if he could explain those to him. And why does this make it more relevant to a wider audience?
Changes in iOS and Android laws are limiting what data can be tracked and how it can be used, according to David. This will reduce the amount of third-party data available. Companies must figure out how to use their first-party data to find more customers, and that data will become more difficult to come by.
Get the most value for your business by understanding the process and preparing for the sale with information here on our Selling a Business page.
Moving on from Damon’s discussion with David, it’s fascinating to consider how we can use big data to help get the right products to the right people.
David stated that he believes there is a long-term solution. He believes the industry is currently struggling to find it. The idea behind consent management is that you go to a website or an app and it asks you if you want to collect data about yourself. Right now, you go to any website and there’s just a button that says, “Hey” we’ll track you yes or no. There isn’t any transparency. As a result, he believes that the real solution is an app that provides transparency and allows you to track it.
Damon expressed his appreciation for David’s thoughts at the end of the episode.
data, people, first party data, business, ads, companies, target, website, tracking, customers, talking, modems, built, building, buy, product, existing customers, learning, apps, started
Damon Pistulka, David Finkelstein
Damon Pistulka 00:05
All right, everyone, welcome once again, the faces of business. I’m your host, Damon Pistulka. And with me today, I’ve got David Finkelstein, we’re going to be taught from beat x. And we’re going to be talking about understanding the importance of first party data. David, thank you for being here today.
David Finkelstein 00:23
Damon, thank you for having me. I’m happy to be here. Yeah, I’m
Damon Pistulka 00:27
excited because this is something that some people may not think they really should understand. But I think it’s a topic that we’re gonna cover a few things that people may want to learn more about it. So I’m excited. Excited to talk today. So David, we always like to talk to start off the show by letting you kind of give us some of your background and your history, kind of, you know, how you got to where you’re doing what you’re doing today.
David Finkelstein 00:57
All right, mom, happy to. So my history goes back. I’m a longtime, longtime entrepreneur. I started my first business six months out of college, back in 1994. I started in internet service provider and literally started it because I got out of college where I was using the internet. And then the Internet didn’t really exist back then. Except for in colleges, right. The only other thing that really existed was AOL and prodigy. And so I couldn’t revert back to you know, using something like AOL after using the internet the way it was in college.
So I started an Internet service provider. And that got me off and running. It was literally just started in my, my father had a business. So you know, I’ve kind of have entrepreneurship in my blood, and started it in a little room, in his office building, literally one computer with a bunch of modems hanging off of it. And yeah, and away we went. And so that’s kind of what got me sort of my entrepreneurial store.
And I ended up growing that business, you know, over the course of about six years and selling it into 2002, a cable company called us cable Corporation. At the time, I think they were about the 13th largest cable company in the US. And that’s what was sort of my internet, initial internet journey and help them deploy internet across their cable systems. And then left there and Michael Aronoff, who is now my partner was my employee, number one at that business. And he and I left there and started an internet advertising business called contextual ads. And so what were you
Damon Pistulka 02:53
doing? What were you doing there? Because it said that you served up billions of ads?
David Finkelstein 02:59
Yeah, yeah. So we were sort of a back end platform for targeting ads. And so we built a technology that helped target ads contextually. So basically, you’re if you’re on a music website, we could see that, you know, the website was music related. And as the ad was loaded, we basically looked at the content of the website and said, Okay, this is music related, let’s do a music related ad. And so we use this technology to help target ads for a handful of clients. It really was kind of a lifestyle business. We only had a few clients, eBay, Verizon, and ATT, were our biggest clients.
And yeah, we serve literally billions of ads for them. And that business grew over the course of time to just not just target ads contextually, but also behaviorally. So we started not just tracking what you were looking at today, right on that website, what were you looking at recently? And what are you know, what are the behavioral habits around your website visiting and, you know, ads that you clicked on, and things like that. So we really got to know and understand the consumer better. Yeah.
And that that sort of brought us into the state of business that we’re in today with BT x, because, you know, at the time, we ran that business for about 10 years, and then sort of lots of other technology came out for targeting ads, and it sort of got commoditized. Right, yeah. And so when you in a business, that’s commoditized, you want to look internally and say, Okay, well, what do we have here that really differentiates ourselves? Right? And at that time, we said, Well, we had built this technology to manage the data, because we were, like you said, we were driving ads for billions of ad impressions, and tracking a lot of data.
So just managing that data was difficult. You know, we’re talking, you know, yeah. I’m trying to think, you know, we’re talking Between 10 and 15 years from now, so you didn’t have the processing power we have today. So there was a lot of work to manage that data. And so we saw the value of the business going forward, was really tied to the data, that the data was the key to everything that we were doing. And that’s when we set out to build beat x, which is essentially this data exchange platform, which is really geared towards driving performance for advertisers. Based on you know, timely data.
Damon Pistulka 05:39
Yeah, yeah. So you developed another one in here, too, that I saw in your profile called triple jacks, that triple jack of poker. So, yes, in your spare time, you’re like, Hey, let’s go up with a fun one.
David Finkelstein 05:53
You know, it’s a funny story, actually, somewhere along the line. I’m trying to remember exactly when it was it was before we started BTech. So it was, you know, while we’re, we’re running contextual ads, I got into poker. And so I started looking for someplace to play online. And I wasn’t into playing for money, because I wasn’t ready to you know, I was just learning how to play. And so I found this website, triple Jack was a website at the time. And there really wasn’t a business around, it was a turned out, you know, it was just a fun game to play.
And, you know, I had contacted the owner, the guys, there were two guys that created the game. Crazy story is these two guys never met, they hadn’t met each other. They both met each other online. One was more of a designer, graphic designer, computer designer, and the other was more of a computer programmer.
And the two of them said, Hey, would it be cool to create a poker game? Would you design it, and I’ll do the back end work. And they had created this game without ever meeting. And so I had met them online and started chatting with them. And I was like, I kind of like what you guys are doing here. But I think there’s like more of an opportunity to create kind of a business around it. And so they were like, alright, well, you know, that’d be cool. Let’s talk about that. And I said, Well, let’s, you know, where are you guys live, I’ll come fly out and meet you guys.
And they’re like, you know, well, we’ve never met each other. One of them was from Austin, and the other one from Colorado, Denver. And so I was like, You know what, well, let’s all meet, you know, where should we meet. So we ended up meeting in Austin and met the two of them, we all we hit it off. And we kind of decided, okay, let’s build a business around it. So it’s kind of like a fun side business that we’ve had for a number of years. And, you know, it’s just a fun free. That’s cool. We’re what’s fun about it is you can play a hand of poker and if the other person beats you in hand, you can throw a pie in their face or something like that. Well, I
Damon Pistulka 07:51
saw that that was kind of fun. I’m gonna have to get on there and try it because I think that would be a good time. Have a good time. We got we got a lot of people in here today. We got Michael Connors in here today, Jesse’s here, saying hello to Mike and load everyone else. We got Elizabeth Jeffrey’s here. And then down here. Jesse’s got some comments in here. And I’m trying to get through a few of them here. Michael’s here. I believe you know him.
So you’re, you’re your partner in the business. There is good stuff. And, and then Jesse’s saying it’s exciting to hear your story. So it’s awesome. It’s awesome. And then we got Joshua Morgan. There we go, Joshua. Nice to see today. Josh. Cheers. So, so you’re in B decks? And what I mean, because you started this eight years ago, right? You started eight years ago, this is before people were really talking about first party data, because we’re living in the heyday of Hecate years ago, was like, just put up some paperclip money and you can sell stuff. Right? Yeah. Yeah. So So what really? Yes. That’s some forethought there to be able to go into that. Yeah.
David Finkelstein 09:09
I mean, well, honestly, one of the things that really sort of caught our eye in starting this was when we had the other business contextual ads. And we were, you know, we were looking at the data that we had about, you know, that we were using to target ads. Yeah.
And then we said, You know what, let’s talk to some of the other data companies out there and talk to them about licensing the data. And so we’re like, you know, it’d be interesting to see if they could leverage this data to write for their advertisers. And so we did that. And in talking to them, we realized that there were some challenges in doing that, because they were asking us to zip up big files of data, you know, that we had seen people going to certain types of websites or whatever it was, we would send it to them and they were like, they would tell us okay, well, now we’re going to aggregate this data with some other data.
We get from some other sources, we’re going to build audiences out of it. And then we’re going to activate it. And so that whole process took about 90 days. And so, as you can imagine, if we’re tracking, you know that you’re looking to buy a new car, and then we’re gonna give them this data, and they’re gonna process it for 90 days and then activate it for their advertisers. You know, 90 days later, you may have bought
Damon Pistulka 10:24
that car. Yeah, it’s done deal. Yeah,
David Finkelstein 10:27
So that’s really what started the whole thing is we said, Wow, this whole process that you guys are using is kind of broken, like you’re losing all the value of the data. And so we went to them and said, hey, what if we could build a platform that would help you aggregate that data in more real time, let us do the aggregation for you. We’ll aggregate it with all kinds of other data assets, and then help you activate that.
And so that’s kind of what led us to start VT X was just that idea. We kind of foresaw that that would solve a problem. It turned out that everything didn’t work as planned, right. And nothing ever really does. And yeah, we pivoted a little bit from that, since today, but overall, that’s how we, you know, started the whole thing. And that was the whole idea. And the concept between behind the data exchange platform, which is really the backbone of our platform.
Damon Pistulka 11:23
Yeah. Yeah. So for four people. Hey, hello, Rodney, great to see you today. For people that understand first party data, can you just give us a brief synopsis of what first party data really is?
David Finkelstein 11:43
Yeah, I mean, first party data is the data that you own as a company, about your customers, right. And so you have the opportunity, when you have a customer to collect information, whether it be just from them buying it, you know, maybe they bought a product. So now you’ve learned something about them, or whether they’ve actually, you know, you’ve surveyed your customers and ask them for information.
That’s, these are ways that you can obtain information about her existing customers. And so, you know, what we’ve been challenging businesses to do is find ways to leverage that first party data, it’s super valuable. And a lot of companies use it, hopefully, to decide what of their own products they can target to their existing customers, right.
So you get that all the time, right? You buy something from Amazon, you get an email, saying that we have, you know, some other similar product or whatever. Or when you go to their website, it says we have this similar product to what you previously bought. And that’s great. But the real question is, how do you leverage that to find new customers? And so that’s what we’re really challenging people in the industry to resolve. And so our latest product, our Omni IQ machine learning products, does exactly that. And it’s building audiences that are seated, based on your first party data so that you can find more people. Like those people that have purchased from you before.
Damon Pistulka 13:10
Okay. Yeah, because so the great explanation. So thanks. Thanks for getting us that started there. So there are some changes for the people that don’t know that are there have been in the past recent past with Apple and some privacy changes, and then the upcoming things that Google or our Google is going to be doing with cookies. Can you explain those a little bit? And why that makes this more relevant to more people?
David Finkelstein 13:40
Yeah, certainly, I mean, with the changes in the laws, the changes in iOS and Android, that are limiting, what data can be tracked, or how it can be tracked, or how it can be used. That’s going to limit the third party data that exists out there. And so that basically means it’s going to be harder to find resources, that will be able to provide data that will help you target your advertising today.
And we’ve seen, you know, our clients, I’ve seen friends that have already had their businesses affected from this, from those changes, just because the ad targeting within Facebook or within Instagram or, or within any ad platform that they’re using just isn’t working as effectively anymore, because there is less data being trapped about consumers. And so this here, and you know, this is the, you know, the problem that I sort of mentioned earlier, is just companies need to figure out how to leverage their first party data to find more customers, because that third party data is going to get harder and harder to find.
Damon Pistulka 14:59
Yeah, So, then this is I’m gonna, I’m gonna try to give my my simplistic view of what was happening if I had before, like iOS, for example, I’ve got an iPhone, before the iOS privacy changes. And you mentioned laws too. And laws have affected this in certain states. But before that the iOS privacy changes. Facebook was monitoring, not just when I was on Facebook, but it was monitoring all of my activities on my phone, correct?
David Finkelstein 15:29
Yeah, I mean, it could basically have access to not directly they’re not monitoring what apps you’re using. But those apps that you were using, had a, you know, a mechanism where they could sell that data to Facebook, they could track it and sell it to Facebook, and every website and every app they’re using essentially was doing all of that. And that’s why you’re able to, you know, sort of be targeted across, you know, different apps or different websites that you’re using with similar content.
Damon Pistulka 16:05
Yeah, yeah. And it’s, it is, you know, people often wonder why, you know, I was just thinking about buying something, or I may have searched for it, and then all of a sudden, it shows up on my phone, or it shows up in a different app and something else, and that was part of that ecosystem working behind the scenes. Yeah. And, and with the iOS changes, that that was largely limited.
And so you’re saying that the first party data, what you’re doing is you’re actually taking the people that I’m selling to understanding them better? By using that using the data that you can, you can legally and ethically collect on them, and turn it into here, maybe other people with similar situations? I don’t know, if you’re using the right words, but similar habits or patterns that that would say that they could be potential customers?
David Finkelstein 16:59
Yeah, exactly. Okay.
Damon Pistulka 17:03
This doesn’t sound easy.
David Finkelstein 17:06
No, it’s not. In fact, I mean, a lot of this couldn’t have been done just even just a few years ago, because of the processing power that’s required, you know, to process this much data. Yeah.
And so, you know, we were just literally just having conversation about that today, in our engineering meeting, just the fact that, you know, there’s a lot of processing that goes behind building an audience based on you know, you know, a first party seed, and then applying machine learning to it, there’s, there’s a lot of, you know, because of all the processing that’s going on that, you know, it’s like, it’s just something that, you know, if you just go a few years back, you probably couldn’t, couldn’t even do it to the same. Yeah, I could do it today, it would just be cost-prohibitive, it would
Damon Pistulka 17:55
cost ya lunch. Yeah. Well, Michael says that the time is now to leverage first party data. I think he’s right, because, you know, and this is, this is, this is hidden, anyone that’s advertising really, it’s because it’s, it’s making it less and less, each dollar less and less effective, unless you are doing something outside of the methods that were used before. So Google’s also changing something in to do with cookies, and that’s going to take them a while yet before they do it. But what is how is that gonna further affect this?
David Finkelstein 18:28
Yeah, I mean, it’s all, it’s all part of the same ecosystem. So because with third party cookies, you know, going away, that means less data on the open web that will be tracked. Right, so across multiple websites, so you know, when you’re talking about third party data, it’s like you’re on Facebook’s website, and you know, when you go to Facebook’s website, right now, or Yahoo, or any website, you go to, there’s, you know, 50 different companies that are tracking your activity on that website, so that they can learn something about you, and, and target you.
And, you know, you know, there’s, you know, controversy around whether people like being trapped or not, but from my perspective, you know, and I’m not just saying this, because it’s the business I’m in, I’m saying this as a consumer, that I want to be targeted, because I don’t want to go backwards. I don’t want to see ads for you know, insurance all the time, or, you know, payday loans, or whatever we used to see back in the day when you couldn’t target ads, it was very generic ads.
I like when I go to a website, or an app or whatever it is, and I see an ad that is related to something I’m actually interested in. And I give this example all the time. People that follow me online have seen this example numerous times, but I haven’t been to McDonald’s in 25 years.
And yet, when I watch TV, I see McDonald’s at almost Every day on, you know, linear TV because they don’t have the ability to target me. They have no, they don’t know enough about me. I don’t want that, you know, like that. That’s not it. That’s not a good experience to me. You know? And so that’s the challenge is right, how do you get people comfortable with, you know, data collection and targeting, but at the same time, you know, give them the quality experience, you know, because there’s been too many companies that have abused, right, abused the privilege of targeting and tracking data that have, you know, kind of, you know, ruined the sort
Damon Pistulka 20:44
of muddies the waters for everyone else water trying to do it. Yeah,
David Finkelstein 20:47
yeah. Because if you want to do it, if you know, and you want to do it in a respectful manner, then it can be very, you know, it can be very rewarding both for know the company that’s doing the advertising, but also for the consumer. Hmm.
Damon Pistulka 21:03
Well, yeah, like you said, you’re getting the ads you want. And you answered a question that I was actually asking myself a few weeks ago watching television, I was like, I wonder if they’ve gotten to the point to where they actually are feeding me the ads that I really want to see. Because it sure doesn’t seem like it, because every other one’s a GEICO commercial. And whatever else, I think they must have
David Finkelstein 21:26
a problem with TV is they just don’t have the ability to target, you know, the setup boss level, to an individual to an individual or an individual household, the way that they do it, you know, they do it based on DNA. So everybody in that, in that DNA is getting targeted, you know, they’re getting the same ads, that’s the problem. Yeah, like on the web, or on a mobile app, or even on a CTV platform, you know, where you can actually have a much more targeted ad. But, you know, with these, these changes, you know, you’re gonna, you’re gonna see some things go backwards.
I mean, I was just on the phone yesterday with a guy consulting for $100 million a year business that has a $400 purchase point for a product and their costs, their acquisition costs have shot up to $100 over $100. Yeah, because of these changes. And so they’re coming to me and saying, how do we fix this like to help us find, you know, the right people to target our ads to because we can’t continue our business like this?
Damon Pistulka 22:36
Yeah, it’s huge. I mean, because just because it over the past, you know, COVID, cause just normal Pay Per Click prices that go up because of competition. And, and people wanted to sell more online, but I’m sure that the, the lack of targeting or as it change, the reduced effectiveness of the targeting, like you said, can put companies literally out of business?
David Finkelstein 23:01
Yeah. Yeah. So
Damon Pistulka 23:03
when you talk about putting this together, right, in, you go in, you mentioned something in a post, I think it was today or a few days ago, about touchpoints. Now, kind of without getting to do anything for prior Terry, how are you doing this? I mean, because it’s just seems like this is a massive thing to figure out what I’m doing on a given day, or how do you how does it happen?
David Finkelstein 23:33
Yeah, it’s, you know, it’s billions of data points coming in daily from, you know, 1000s of, you know, different, you know, websites and apps, and yeah, POS systems that are tracking purchases, and all kinds of things. And so then you have to take all that and you gotta put, you know, they’re basically puzzle pieces, right? Each one is a little piece of data, and it tells us something, but it’s really nothing without the rest of it all put together. So, you know, it’s, you know, it’s a matter of taking all this data and really sort of reconstructing it into something that’s useful.
Damon Pistulka 24:12
Yeah. I can, I think that my, my habits, you know, I was in Starbucks today got a coffee. That was probably tracked by some, some for some reason, and how does that affect the whole thing? You know, how does that affect me? It’s just it’s, it’s really interesting to see how we can put big data together to really help get the right products to the right people.
David Finkelstein 24:39
Yeah. And I think long term, I think that you know, there’s, there’s so many things going on right now around identity and ad targeting privacy, that I think that there is a long term solution. I think the industry is struggling to find it right now. But I do think that there is a long term solution around what I would call consent, consent management.
And so that the idea of consent management is, you know, you go to a website, or you’re using an app, and that app asks you, hey, I want to collect some data about you. And here’s how I’m going to use it full transparency. You know, here’s how we want to use it, we want to improve the experience for you. You know, whatever.
And those websites or apps that you trust, that are being transparent, like that, you’re gonna say, okay, to you’re gonna say, Yeah, you know, that, I’m good with that. Some you might not, because maybe they have a history of, you know, that’s pretty, you know, that has already sort of made you feel uncomfortable. And so you’re saying no, to those and the ones that say you say yes to will, you know, track certain information about you, and that information becomes available to other companies that will, you know, be able to track you, but I mean, able to use that data to target you because you allow it.
But ultimately, you know, a lot of that goes on today, but right now you go to every website, and it’s just a button that says, you know, we’re going to track you yes or no. And you’re just like, okay, yeah, okay. Okay. And you have no idea what’s going on. There’s no transparency there. Yes. And so I believe that the real solution is an application that gives you that transparency, and allows you to monitor that. Yeah. All in one place. So you don’t have to go to 1020 different websites or apps and see, okay, what are these guys tracking about me? Should I allow them?
I’m going to turn this one on, I’m going to turn this one off, um, you know, you need sort of centralized place to do that. And if there’s one place that would kind of manage all your consent, I think that that’s the long term solution. No one’s really put it together yet. And, and so I think that, you know, the industry is still playing with lots of different potential solutions. But I think that that is what the industry really, ultimately needs in order for us to be able to have the same experience we’re having today or two years ago, before all this started. And not in feel good about it. You know what I mean? Yeah, like it’s being abused.
Damon Pistulka 27:17
You forgot some really good points when you talk about this, centralized consent management, because if you think about this, and if there was just say, an application on your phone, or your computer or whatever device you’re on, and you can say, Hey, I just want to see the data that was transmitted, you know, that was shared? across everything. Yeah, I just want to see what’s shared. And I really think that 90 plus percent of the time people go, Oh, that’s an Oculus. I don’t care.
David Finkelstein 27:47
Right. And most people don’t care. They but they, but the only reason they care is because they don’t know they can’t there’s no, exactly.
Damon Pistulka 27:55
They don’t know what that
David Finkelstein 27:56
you know, I think people are afraid you’re going to go in too far, you’re listening to every word I’m saying, or whatever it is, you know, people are afraid that you’re listening on their phone, and that Alexa is listening to you. And, you know, Facebook has gotten caught doing that, actually, so. So it just needs transparency.
Damon Pistulka 28:15
Yeah, and I think what you’re talking about would be a really, it would be a stellar solution just because of the fact that, like you said, if I knew exactly what was going on, and I could look at it whenever I wanted, and just knowing that they could, would give people enough confidence to just go ahead and do it. But then if you wanted to take the next level, and you could look at it, and you realize that what it was doing and how all the little pieces were really nothing.
It would make people so much more comfortable. That’s a great idea. Holy heck. So have you been? So you’re on the Forbes Technology Council, and we talked about that a little bit more. And you said that that gives you an opportunity. So to help, you know, comment, and contribute and publish articles and really help educate? So is this centralized? consent management? Is that something you hear other people starting to talk about? Or is it?
David Finkelstein 29:10
I haven’t, I’ve seen a few companies that have created sort of consent management, but it’s more, more I’d say individualized to a single business. Okay, okay, so let’s, let’s just say your Best Buy and Best Buy wants to know stuff about you. And so it may allow them to sort of control what you know, what you’re sharing to BestBuy or something like that, but not okay, not to third parties and not cross platform and all of that. So, I haven’t really seen it. You know, I’ll be honest and say it’s, it’s kind of been an internal project that we’ve, you know, discussed and we’ve been investigating, but, you know, it’s my belief that that’s kind of a long term solution to solve all of this,
Damon Pistulka 30:01
yeah, I think it’s a super cool idea. I mean, I just think so. Elizabeth agrees she thinks she thinks it’s a good idea to so what we agree to and how it’s being used. And it’s Elizabeth, like, like you said, this is not knowing makes people go to the extreme of the bad. So, when on the Forbes Technology Council that you’re on? I mean, what are some of the far out stuff that you’ve seen in on there, you said, you get to comment and review some, what’s the sort of the far out stuff that you get to see that we haven’t heard about? haven’t talked about the girl. While that’s kind of wild?
David Finkelstein 30:43
Oh, you know, honestly, I don’t know that I’ve seen anything that far out on far out, it’s really more, you know, we write, you know, content and publish them, you know, send it to them. And, you know, they’ll publish, the ones that they like, so if they like the content we write, then they’ll publish it.
And so it’s more of an opportunity for us to further educate, you know, we take the, you know, the things that we’re talking about here, we put them into an article, share it through Forbes, tech Council, it’s, you know, it’s really, the tech Council is really just tech leaders around the worlds that, you know, are just sharing knowledge, you know, and Forbes just is sort of the mediator have that knowledge to get it out to the world for us.
Damon Pistulka 31:34
Oh, it’s cool, cool, that you’re involved with it? I’m sure. It’s, it’s, it’s a lot of fun when you can get information shared through a medium like that.
David Finkelstein 31:45
Yeah, we’re all about that. I mean, obviously, you know, anyone that’s followed us, and you can see him following me or the company has seen that we tried to put out as much content as possible, just educating the community about, you know, the industry changes going on in the industry, and, and how, obviously, how we can help, but also just, you know, what’s going on? And where, we think the industry is going?
Damon Pistulka 32:13
Yeah. So in regards to that, what, what do you think is, if you could share what you believe is the most important educational point around first party data that you’ve heard recently? What would that be?
David Finkelstein 32:30
Oh, you know, the one thing I always tell people is just to make sure you’re, you’re leveraging your first party data, because so many people have customers, and they don’t realize that the best opportunity to learn is from your own customers. Right. And so, the worst, the worst thing I’ve seen companies do is send out a survey that’s like, 10 minutes long, asking for feedback.
You know, the best thing I’ve ever seen, was a company called Rackspace where they used to send out and I’ve seen other companies do it soon, since then, but I remember, you know, they used to send out an email with one question, you know, and, you know, click one through five, you know, rate us on this, or whatever, or multiple choice pick one on this, you know, the best way to survey your customers is to ask them, just ask them one question at a time.
You know, people don’t want to invest too much time. And you’d be surprised to how much people are willing to share information with you. You know, if they know you, and you’re talking about your customers, and so your customers are always going to be willing to share information if they believe that that will help them get, you know, better service from you down the road. So that’s an opportunity that should not be lost on anyone.
Damon Pistulka 33:46
And you make a good point and writing the note down, they’re willing to share if they believe it’ll help them get better products or service in the future. And that’s one of the things I think that if you, you get that if you’re telling people that that’s a great point, make that because we will give information if we think it’s going to make our experience or our products or services better the next time. That’s a great point. So let’s see, I’m looking through my questions here.
So as you’ve been going through this, over the years, have the needs of your customers really changed a lot as a change in it or is it always kind of been we’re trying to put together the learn more about their existing and potential customers? Or is there been like, what really changes because we need to know that I don’t even know what right words to ask around this. But it was one of my thoughts is he’s been in this for more now over eight years. And I was just wondering how the needs of your customers have changed other than of course, you know, losing the other kinds of things hasn’t really been much of a change beyond that.
David Finkelstein 34:58
I don’t think that has I mean, it It’s, it’s always, for us at least it’s always been a focus on understanding your customers. For one, and then, you know, helping you reach more customers like them. Yeah, right. Yeah. And so we’ve done it a couple of different ways. And so obviously, we’re steering more towards helping companies use it would do this with first party data where we used to use a lot of third party data to do it in the past.
But ultimately, we’re solving the same problem in a different way. But it’s, you know, it’s always shocking to me, going back to what we were just talking about, leveraging your first party data. So it’s shocking to me how many people come to us, and they want to find more customers, but they don’t know anything about their customers. You know, they don’t, you know, don’t even know, you know, the age distribution of them, or, you know, or, you know, income levels or things like that. Just basic, really simple stuff.
And so that’s, you know, going back to that is, you know, is what we’re always trying to tell people is, it’s really important to understand who your customers and that’s great, you come to us and you don’t know, this, we can help, you know, we have, you know, we can help you figure out who your customers are. Yeah, that’s great. We’re happy to do that. You know, but that’s something that, you know, a lot of companies don’t realize that they could be doing on their own as well, you know, just by asking,
Damon Pistulka 36:28
yeah, yeah, we had a client, literally, this is this was three, four years ago, that had an email list of several 100,000 customers. And they had no idea where they live, they had no idea, they just knew they bought something. They didn’t, they didn’t know anything about him. And it was, it was amazing. And they were not sending out any emails at the time, to you know, so it, it’s just, it’s it changes in people, if your business is doing well, I think it allows you to get a honestly a little bit lazy. And
David Finkelstein 37:09
I mean, when I was just gonna say you gave me the perfect opportunity to plug our product, because that, you know, we have a product that you literally can upload those email addresses, and it’ll spit you back a bunch of charts and graphs and show you, you know, the demographics of the of those users.
And so, you know, we do that as sort of a, you know, almost as a public service where we’re learning to charge for that, because we feel it’s important for you to know something about your existing customers, and you know, obviously will then take that and use that, you know, against our modeling to find more people that you know, that look just like those customers. But that’s these are simple things that everybody should know about their customers.
Damon Pistulka 37:55
Alright, it’s no Sunday. Because yeah, it is it is because I think back to that situation, right? We had all the emails, had addresses had everything, but had no other demographic information other than that, and that’s, yeah, that’s great. That’s great. This is so interesting. I’ve got to go back though, I’ve got to go back and already been talking about the first party data.
And this is just when I think of first party data and what you guys are putting together the gazillion different points that you’ve got to put together and the machine learning and everything else it takes to it’s mind boggling to me. It’s, it’s it’s super cool, what you’re doing. And even like you said, a few years ago, you couldn’t even do this kind of stuff. Because it was cost prohibitive from a CPU power standpoint. Yeah. But what do you think we’re gonna be able to do a couple years from now that you’re like, man, we can’t even touch it now. But I really think things are gonna happen.
David Finkelstein 38:52
Yeah, that’s awesome. It’s a great question. And I think that, you know, one of the really cool things that that I look forward to is when we can actually do that, in real time. Yeah. So, you know, the machine learning algorithms are learning as you’re doing things online. You just bought something, the worst thing that I’ve ever seen, and you see it all the time, you just you buy something online. And then you see an ad for the same thing for the next 48 hours. Because you figured out that you bought, right? Yes. So imagine in a world where you start searching for something and now you’re seeing ads for for exactly what you want to buy, and you go and you buy it.
And now that stops because it realizes that you made that purchase and now you’re on to something else, right? And now it’s your wife’s birthday and you’re searching for something for her birthday. And now what’s really going on and stuff for that, you know, that to me is is like, you know, that’s the ultimate goal is when these you know this machine learning algorithms can kind of learn as you go, you know, and process data as you go so that it’s constantly, you know, targeting you with the right messages instead of stuff you bought already. Yeah. Or whatever.
Damon Pistulka 40:14
That’s a great point, though. Because how annoying is that, that when it because it happened, it’s happened to everyone because it’s still, I mean, still a fact of life with us. But to be able to move on and change from it is great. So I do have one question back when you’re when you started your internet, when you’re had the internet service provider company, I mean, you’re you.
I’m imagining you because you’re in your dad’s shop there and you had the computer with the modems on it. I mean, how did that change over the years that you had that because that was a crazy time? Yeah. It you know, dial up to broadband or whatever, constant connected internet. So this explain that a little bit. That’s,
David Finkelstein 40:58
I’ll paint you a picture. So we start out by so my my father, so we started this business in New Jersey. And so we had this building, my father had this office building that was in downtown Ramsey, New Jersey, for anyone that knows New Jersey, small town in northern New Jersey. And the building itself Well, I think was built in like 1901.
So it was an old was actually an old house that was converted into an office and office building. And so you can if you can picture this old house from, you know, 1900s literally had a rock foundation, the foundation was made of rocks with mortar between them. And, you know, so in the basement of that was where the phone lines came in. And we actually had, you know, when we started this business, we had a single 56k line into the internet, right?
I think we got what 18 T or something. And then we had a computer with like eight or 10 modems connected to it with a little model serial port that tic tac dater 10 modem so and so we created you know, we built a software that would allow people to log in and then be able to connect to whatever there wasn’t really a web back then. So it really was like, first order was newsgroups. And you’ll use that newsgroups and email and stuff like that. And then web started, you know, started out soon after. And so that’s how we started.
And so over the years, we started taking up more and more space in the building. And so, you know, at one point, we had one of the rooms which probably was only if I guess probably about 12 by 12 room, but in that room, by the time we had sort of built up this business, there were racks computer racks lined up in this building with computer equipment and modems that were built in rack so us robotics made like a big rack where you could fit like modern no 20 modems into it into the rack and so we have these things all lined up on these racks in this mind you building that was built in 1900. And you know, I’m by then we had a couple of T one lines coming into it.
So the speed would have gone up a little bit over the years. And then we even had your few other locations where we would put you know, equipment in some of our clients offices so that we could have local dial numbers in different places before you got you know, sort of those companies like a TNT that would set up international dialing numbers.
And so that’s kind of how we started the whole thing when we sold it, we had three locations in New Jersey, but we were serving but by then we had a relationship with ATT and we could leverage other phone numbers throughout the country. So we were providing national dial up and we were doing websites and we were doing all this stuff in this you know by the time we sold the business I had taken over the whole building my father had had had sold his business and moved on and we had taken over the whole building and it was just kind of this weird, you know, Clash of this old building and all this what was new technology at the time it was kind of neat.
Damon Pistulka 44:16
Yes. Well it’s interesting for people that grew up in the last you know 1015 years is the constant and you know a constant on internet in our cell phones and everything don’t realize you know the old dial up or the modem had to dial the other modem and the connections and stuff and that was quite the exciting time as things were
David Finkelstein 44:39
removed. I still have that here actually that is the original hard drive that ran the entire company. When we first started it and the the the team back then I think it was a five year anniversary we had finally retired that computer and they took the hard drive and framed it for me.
Damon Pistulka 44:59
Oh Oh, that’s nice. That’s nice. Well, yes, you know, David, I just appreciate you taking the time to talk about first party data and some of your thoughts around it. Because I know what you guys are doing at BT x there is really helping a lot of people that want to understand more about their, their current and prospective customers. So what what’s the best way? If somebody wants to get a hold of you? Is it to get on the beat X website and go through there? Or what’s the best way to if someone wants to reach out to beat X?
David Finkelstein 45:35
Yeah, I mean, the website beat x.com Super easy. You can reach me at David at beat x.com or connect with me on LinkedIn.
Damon Pistulka 45:45
Awesome, awesome. Well, it’s been a pleasure having you here today. David Finkelstein, B. Dax talking about understanding first party data you’ve given us so much, so many insights and thoughts and perspectives on I just appreciate it. And love the love the story about the ISP and, you know, triple tack your your poker company, I think is a fun, fun little diversion. So, thanks for being here today.
David Finkelstein 46:12
My pleasure. Thank you, Damon. Anytime. All right.
Damon Pistulka 46:14
Awesome. Well, everyone, thanks so much for being here today. We will be back again next week with another guest on the faces of business. Thanks a lot.
Schedule a call to discuss your business goals and answer your questions on growing business value, preparing for sale or selling your business.