Co-founder & CEO – Cobiro
Last month, the Google AdWords automation platform, Cobiro announced a $2 million grant from the European Commission. The company, using automation and AI technology, optimizes the small businesses advertising campaigns on Google, adjusting and improving in real-time. To delve deeper into the services that Cobiro offers as part of their autonomous Google advertising suite,we spoke to Bo Krogsgaard, CEO, Cobiro.
Tell us about your role at Cobiro?
Being Chief Executive at Cobiro is a versatile job. It covers everything from strategic decision making to leading a team of highly skilled engineers and other key team members to make certain we are aligned and working towards the same goal; to become the leading autonomous platform for helping small businesses grow. This past year has been amazing and we have gone from 5 employees to 27 at our office in Copenhagen. After New Year’s, we are moving to a new office space where there is adequate room to continue growing at our current pace.
I have been in the digital advertising space – along with my colleagues – since the dawn of Google AdWords, and I know the platform inside-out. We understand its opportunities and limitations and how to put all this together for small businesses to get optimal impact from this great tool. AI and machine learning is obviously key to getting it right, but equally important is the user experience. I spend crazy hours optimizing the user experience for our customers, as this is the best scalable way to make certain we constantly improve the offering.
We have been fortunate to hire some of the best engineers and customer success people out there. As a computer scientist, I am per definition focused on the technical aspect of the business; however, our mission to make small businesses grow has given Cobiro a sense of direction that has evolved in both force and commitment.
We know our tech is stellar, but it has been cool to see how both the data scientists and the customer success team are totally stoked about delivering on this mission. Our culture is amazing and getting stronger by the day. I am really proud that so many want to join us on this journey and I am seriously involved in getting this aspect just right.
What services do you offer as part of your autonomous Google advertising suite?
Cobiro is an autonomous platform for managing and optimizing advertising in Google. It is mainly powered by AI to do the core of the job and we can set up a super professional campaign from scratch within a couple of minutes. We have two types of services, one for e-commerce and one for websites for small law firms, carpenters or dentists and numerous other businesses run by few employees.
For the e-commerce businesses, let us assume you have 1,000 products in your online store, which is typical for a medium-sized online business. Cobiro will analyze all 1,000 products with our NLP – Natural Language Processing – service and set up 3-4,000 relevant keywords in less than 3 minutes including the categories. This is quite a sophisticated process and is usually done in a much more comprehensive way than what a human will be able to compute and put together.
We also set up Google Shopping and adjust the bids with our proprietary bid management module – I think we are the only service to offer unit based bid management for Google Shopping and this is also included in our freemium service.
For website customers without a shop, we are doing some really cool stuff. We have trained our neural network on more than 80 million websites and this makes Cobiro able to instantly determine whether you are a carpenter, a lawyer or a magician. At a more accurate level, we can distinguish between different types of lawyers; something making a lot of difference in the campaign setup and therefore reflected in the results of the campaigns our customers are running.
The algorithms are constantly monitoring everything from opening hours, phone numbers, addresses, and even customer reviews that can also be a part of the ad on Google. People are really impressed with the high quality of the campaign Cobiro is setting up for them and a lot of our customers are upgrading to our $49 per month premium plan since they feel they get a lot in return – and they are.
How do you intend to deploy your recently acquired capital? What markets are you focusing at?
At Cobiro, we are laser-focused on the small- and medium-sized businesses. We do cater to a few enterprise customers but our core is businesses with 1-50 employees.
The funds received from the European Commission are from the SME Instrument Phase II fund and they are earmarked towards growth for SMBs. This means that we are spending the money on understanding the needs of the customers and how we can address the market needs in the best possible way. I believe it is important to clarify that the money is a grant that covers 70% of the expenses for the project that we have proposed to the EU and as Cobiro’s Google AdWords service is working in 39 different languages it will be a broad market to approach.
Today, we have customers from 34 countries – many from the US but also a lot from other countries like New Zealand and Russia, and some emerging market countries are also joining our movement. It is very satisfying to offer a service that appeals so broadly to such a targeted service.
We are currently raising a larger round of capital to expand further and acquire more customers and our target is no less than 500,000 customers by the end of 2018. This will be a stretch but at the current pace, we trust we will have a legitimate shot at reaching this milestone. It will not be easy, be we are so incredibly committed to getting there.
How do you see AI-driven Content Marketing And Advertising Platforms adopted by SMBs and agencies?
This is a really good and interesting question. I believe there is a big difference between what we see as obvious for SMBs in terms of AI for and what they see themselves. We have made a couple of surveys that clearly indicate that amongst US-based SMBs 61% of them are not ready to use AI.
The main reason is that they consider it overkill, expensive and difficult to deploy and perhaps most importantly, they do not have the expertise. This is where we see the opportunity – to help them gain results with AI, without them knowing the details of AI. It is a little like a car that brakes automatically if people are texting or losing focus on driving the car. People are not interested in all the sensors and stuff that makes it brake, however, they are happy it reduces all these small accidents that can actually turn out to be fatal.
Cobiro is doing super sophisticated stuff behind the scenes, and there is so much more in the short-term pipeline – but we do not market it as AI as it can sound scary to some of our customers. They are mostly interested in getting more attention, better leads and higher conversions and this is exactly how we will help them grow their business.
What are the core differences in adoption of AI solutions between big legacy brands and SMBs?
From our point-of-view, it is primarily the amount of data available – and price. When larger corporations adopt new tech that incorporates AI embedded into their existing IT-systems, the process can become controversial as many stakeholders join the table. When SMBs are deploying new solutions using AI, it is often without knowing it – and therefore no IT-integration is needed – so they can be up and running within a short period of time.
We would find it challenging for Cobiro to scale if we focused on the enterprise segment due to the long sales cycles, and also the bespoke integration-requirements they request. 99% of companies within the EU and US are SMBs and this market is huge and mostly untapped for what we do. We do see a lot of services for SMBs that pop up and save both time and money: ERP systems are starting to scan invoices and reimbursement receipts automatically and bookkeeping can even be done more or less automatically. For an enterprise company to do this, it can take years of development and testing since they mostly develop everything for their own purpose instead of using preconfigured solutions.
What other AI platforms are you keenly following?
My friend Dennis Mortensen is running a company called x.ai out of NYC and it is quite interesting to see how they have solved the pain of booking meetings using NLP. For $17 a month you can get your own personal assistant that remember your preferences and again – it is seamless tech. You do not have to install anything – just cc firstname.lastname@example.org and “she” will take care of everything for you. I find this intriguing and super interesting that people are now starting to interact with this kind of technology and often without recognizing that it is a bot at the other end. Tech has really matured and I can only fathom what is next. At Cobiro we are doing our best to be a part of the next cycles and set the agenda for tomorrow’s tech.
What are your predictions for 2018 on AdWords management?
For the last 10 years, we have experienced larger enterprises increasingly being managed with the help of Google and their team of experts, in addition to outside consultants. Equally, the mid-market has been taken care of by around 36,000 Google Partners around the World and other specialist resources, but now we see them becoming slightly squeezed by the tech-boom.
For the larger part of the market, however, Google is introducing a lot of great tools that really optimizes its performance. This will probably squeeze the larger bid management companies that are focusing on the enterprise market even further. Ideally, Cobiro can help Google Partners by managing more of their customers. But, one matter is particularly interesting and that is how the smallest advertisers – with a budget of less than $800 per month – now have a shot at reaping the same benefits from Google AdWords as their larger counterparts. They have had a tough time getting support as the fee from the Google Partners has taken too much out of their budget and left them with too little to actually drive new customers towards them.
A majority of our customers are from these small segment and they really grow their business with Cobiro.
Which market leads the AI race: US or China? Would the race get hotter in 2018 with new markets and players?
That is very hard to tell but we see great impact on both sides. We know all the big tech players, including Baidu, Alibaba, Facebook, Microsoft, and Google are investing heavily in AI and many of them are open sourcing a great deal of it. Google’s acquisition of DeepMind was one of the better moves. Most importantly, we see this leading to economic growth and automation of tasks that are not generating much value or joy and people doing these jobs can now educate themselves to do things that matter more.
Copenhagen, Denmark is actually picking up on AI as well and is gaining traction to make an impact in the development of AI and surrounding services. We have a long history and tradition in tech and a lot of exceptional universities that support the transformation into AI. I know of a couple of stealth companies in Copenhagen that are driven by some very smart people that are developing stuff that will impact the economy greatly.
Thanks for chatting with us, Bo.
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