Munich Startup: Who are you and what do you do? Please introduce yourselves briefly!
Andreas Kleofas: Hi, my name is Andreas Kleofas. I am the co-founder and managing director of Emax digital GmbH, where I primarily focus on developing our analytics. Before founding our company, I worked for seven years in various management positions at Amazon. There, I was mainly responsible for developing global reporting and analysis tools for the Amazon advertising team. For example, we linked campaign data from major advertisers like Procter & Gamble and Philips with sales and category data. During this time, I naturally became aware of the problems brand manufacturers face in this area. In addition to being a founder, I also mentor other startups and lecture as a lecturer at the Munich University of Applied Sciences.
Dominik Pietrowski: I am also a co-founder and managing director of Emax digital, where I am responsible for marketing and sales, including customer acquisition. Before that, I worked at Amazon for almost six years. In 2012, I helped build up the advertising business in Germany from the Munich office before moving to the New York office in 2016. Andreas and I worked together on a wide variety of projects for brands such as Philips, Beiersdorf, and Nestlé during our "Amazon years." We helped brand manufacturers make the right activation and investment decisions to be more visible and successful than their competitors. Before that, I worked as a product manager at L'Oréal Paris and Adidas, where I was responsible for brand building, advertising campaigns, merchandising, and sales promotions—back then primarily in brick-and-mortar stores. My education: I completed my business administration studies with a "classical" diploma from the Otto-Friedrich University in Bamberg. In addition to my work for Emax digital, I also act as a mentor for other startups and work as a lecturer in business administration at the Munich University of Applied Sciences.
Dimitri Dumonet: I'm Dimitri Dumonet, third co-founder and chief developer of Emax digital. My job – in a nutshell – is to implement the company's technological vision. I originally studied environmental engineering and discovered my passion for technology and programming while working as a student assistant for simulations in the engineering field. I subsequently worked as a programmer for various startups, including as the first full-time employee at E-bot7. At that time we were sitting in Startup Accelerator Wayra, where I met Andreas and Dominik. They then inspired me with the idea of making something as complex as Amazon simpler for retailers and advertisers, so I joined them.
Munich Startup: What problem does your startup solve?
Dominik Pietrowski: With our AI-supported reporting and analysis software, we help brand manufacturers optimize their online retail through digitalization. Specifically, we provide them with recommendations for action, for example, on the appropriate level of advertising investment on Amazon. We also provide very simple access to all relevant data in their business, from the sales side to marketing measures in Amazon search and the Demand Side Platform (DSP). This enables them to plan more precisely, conduct better negotiations with Amazon, and thus achieve greater long-term success.
Andreas Kleofas: The digital association Bitkom recently determined that only 8 percent of companies use AI – and not even in their planning. However, no product-producing company can avoid online commerce these days, and most manufacturers are already investing large sums in sales through Amazon and in advertising on the platform. However, they can only utilize a fraction of the relevant data, either because it's too time-consuming for the limited time available or because the necessary know-how is often lacking.
Emax digital: “Agencies and consultants also work with our tool”
Munich Startup: But that's been around for a long time!
Dimitri Dumonet: Of course, there are many Amazon agencies and service providers that either provide consulting support or use AI to optimize bidding on Amazon search ads. That's true. With our technology, we take things a step further and provide support at a very strategic level. In other words, we answer the question of where a manufacturer should start in their Amazon business (e.g., which products should be optimized first) and how much they should invest in Sponsored Ads and DSPs and when. They can then continue to do this with a bidding or campaign management tool of their choice.
Dominik Pietrowski: In fact, agencies and consultants also work with our tool and our technology because they can offer an advantage to their clients: data-based recommendations for action.
Munich Startup: What have been your three biggest challenges so far?
Andreas Kleofas: There are many challenges in a startup. Our first round of financing was definitely one of them. We started bootstrapped and wanted to stick with it until we had a solid proof of concept. And that worked out. But it was actually quite a challenge to raise external funding from business angels and VCs alongside our ongoing business. You have a lot of time-consuming discussions and have to constantly refine your pitch. It's incredibly fun, but it's quite a balancing act to find time for product development, customer acquisition, and potential investors.
Dimitri Dumonet: Technologically, we're very proud of our microservice architecture. We've invested a lot of effort and time into developing a scalable system. The system collects more than 80 million rows of data daily, from simple APIs to complex crawlers, and stores them in our data lake and data warehouse. Our data lake allows us to process the ever-growing data volumes, identify complex relationships, and make predictions using artificial intelligence. We can then display the insights we find using a business intelligence interface.
Dominik Pietrowski: I'd also like to mention hiring. A well-functioning team is essential, especially for fast-growing startups like Emax digital. It's not always easy to stand out among other great employers in Munich. However, we've been able to more than double our team size to 21 employees since last year. Fortunately, we went through the tough school of work at Amazon and know how to set up a good interview process. Finding the right people, however, always involves a lot of effort. But it turns out the effort pays off, and we're incredibly proud of each and every one of our team members.
“Sales doubled and we continue to gain momentum”
Munich Startup: How are things going?
Andreas Kleofas: We're very satisfied. Currently, we offer brand manufacturers access to managed services with a focus on Amazon advertising in combination with our technology. In the future, we want to focus entirely on the technology – our revenues in this area have already doubled year-to-date, and we're continuing to gain momentum.
Dominik Pietrowski: Last year was marked by the coronavirus lockdown, which also left its mark on our customers. Many manufacturers still generate a large portion of their sales through brick-and-mortar stores. These stores were closed, and Amazon prioritized items that were particularly important during the lockdown. Accordingly, we also experienced a significant decline in sales. We are all the more pleased that we were able to fully return to growth this year. Our solution also comes at exactly the right time for brand manufacturers. After the initial shock of the lockdown, many realized how dependent they still are on brick-and-mortar stores and that others are ahead in online retail on Amazon. They can change that with us!
Munich Startup: How do you rate Munich as a startup location?
Dimitri Dumonet: Munich is a great place for startups. We started in the startup community Wayra in the city center and had direct access to the very lively ecosystem here in the city. At the beginning of the year, we moved to Plant1 We moved to Berlin and feel very comfortable there. The exchange with the various tech startups is very valuable and helpful, as there's a strong desire to support one another.
Andreas Kleofas: Even before Emax digital, we lived in Munich, had good jobs, and were well-connected. The comparatively high cost of rent is still difficult to manage at the beginning of a startup. We founders were able to survive a few lean months with our savings, but of course, we then had to generate revenue relatively quickly or bring in investors. And of course, such costs also affect employee salaries. As a startup, we cannot pay corporate salaries, but we score points with candidates with other advantages. However, even the most motivated employee needs a roof over their heads, and that is cheaper in Berlin than here. Accordingly, we are more willing than in the beginning to accept employees who only work for us "remotely."
Dominik Pietrowski: On the other hand, Munich and its surroundings are a great place with many companies of all kinds. This is, of course, very helpful for sales!
Munich Startup: Hidden champion or shooting star?
Dimitri Dumonet: We're part of the Munich startup ecosystem at Werk1 at Ostbahnhof and in the Wayra Community, Telefonicá's accelerator. So, there are a lot of great startups! Next door to us in the office is Tradelink, for example, which I consider a definite rising star. They're revolutionizing the logistics industry with their digital solution for end-to-end delivery coordination and are experiencing tremendous growth following their investment round.
Andreas Kleofas: In my opinion, Bonfire is also a hidden champion. It's an even younger startup, currently in its seed phase. The founders have developed a digital team platform with a psychological foundation that enables companies to develop a sense of community and work efficiently despite remote work and home offices. That's truly exciting and groundbreaking.
