Karen Zimmerman, managing director at Golden Seeds and lead investor in DEVCON
November 13, 2018Editor’s note: This is an update to the original blog post, “How did she do it? A Q&A with Maggie Louie, CEO and co-founder of DEVCON,” published on Nov. 13, 2018.
We are thrilled to share that Golden Seeds company DEVCON was recently named a World Economic Forum’s Technology Pioneer. Congratulations to Maggie and her team!
The Technology Pioneers bring together 100 early to growth-stage companies from around the world that are pioneering new technologies and innovations. By joining this community, DEVCON will begin a two-year journey, where they will be part of the World Economic Forum’s initiatives, activities and events, bringing their cutting-edge insight and fresh thinking to critical global discussions.
As a result, DEVCON is now a part of the Forum’s Global Innovators community, which is an invitation-only group of the world’s most promising start-ups and scale-ups. Additionally, DEVCON joins the Technology Pioneers as part of the Forum’s Strategic Intelligence ecosystem. The Forum helps industry leaders and decision-makers navigate transformations across industries, economies and global issues.
“We are thrilled to be recognized by the World Economic Forum and named a Technology Pioneer,” said Maggie Louie, CEO and co-founder of DEVCON. “This prestigious recognition confirms our belief that in the era of digital transformation, security transformation is the single most critical key to enabling safe and fast innovation.”
Read a recent interview between Karen Zimmerman, Golden Seeds member and lead investor, with DEVCON CEO Maggie Louie below.
After working with law enforcement to facilitate the first-ever conviction for online ad theft and money laundering, Maggie Louie knew she could help solve this costly problem for publishers. Her passion to do so was driven by deep roots in journalism and a commitment to preserving independent reporting.
Prior to developing DEVCON, a cybersecurity software company for news media publishers, Louie created digital products for the Los Angeles Times, E.W. Scripps and American Public Media. It was during this time her interest in protecting digital revenue grew as she saw how much damage ad fraud was doing.
Below, I speak with Louie about the impact of her software and how she’s moving the industry forward.
ML: I started the company in 2017 after catching a hacker who had exploited a publisher site and stole an estimated $1 million. After helping win the first-ever conviction for these crimes, I realized ad fraud wasn’t going away; it was a huge issue that publishing and journalism needed to solve.
In recent years, the publishing and advertising industry has come under siege from ad fraud. An estimated $19 billion is stolen each year by advertising cyber criminals, and by 2020, researchers suggest that will rise to $44 billion. We launched our proprietary anti-fraud technology to stop this number from growing. Already, we’ve blocked more than six million exploit attempts and stopped $18 million from getting into the hands of these online fraudsters.
ML: Hackers are always looking for new industries and vulnerabilities to exploit. Ad tech — the technology infrastructure that enables all online advertising — is one of the fastest-growing industries under cyberattack. It is also one of the most underserved by cybersecurity solutions. This is due to the extremely complex nature of ad tech, making it next to impossible to shift into easily for cyber experts. The ad quality companies that exist, while good at measuring bot traffic and viewability, lack cybersecurity expertise to detect and block viruses, trojans, crypto-miners and other exploits leveraging the ad-highway to attack businesses and consumers. It’s also not an area of expertise for large, broader security software like Norton and Symantec. DEVCON is the only cybersecurity software that’s specifically developed and designed to defeat malicious exploitation of ad-tech “advertising-technology.”
DEVCON, in partnership with the Local Media Association, OpsCo and Adhack.org, is now providing thousands of publishers with free access to its premier platform with our one-of-a-kind FREEDOM for MEDIA program. This is allowing small- and mid-sized publishers to have real-time alerts on ad fraud breaches and attacks.
ML: One of the biggest challenges was educating publishers and media companies about the underlying attacks happening in their industry every day. Invalid and non-human traffic, viewability issues and pop-ups are all interlinked. For example, a pop-up could be delivering an exploit and injecting ad tags onto a website that then siphon off revenue from the publishers legitimate traffic. A savvy hacker could also bombard those pages with bot traffic, multiplying the ad dollars that are being diverted to those injected tags. That’s just one example of the many types of exploits happening every day.
Initially, educating the industry about what was happening, and finding the key customer who understood the problem we are solving proved more challenging than we expected. Through education and research we were able to finally connect the dots, but understanding the needs of our core customer was ultimately what brought us to a true product market fit. Now, we have a 26 percent conversion rate from free users to paying subscribers.
ML: The launch of our FREEDOM for MEDIA program was a huge milestone for us. In addition to partnering with Local Media Association, OpsCo and AdHack.org for this program, we are working together to create the largest study of ad fraud across small- and mid-tier publishers. The study will bring awareness and transparency to this overlooked side of ad fraud that is using the ad tech infrastructure to deploy deep cyberattacks, and move billions in ill-gotten-gain without detection. A panel of thought leaders participating in the study will present the results at the 2019 Mega-Conference.
We are also closing a Series A funding round for $3.5 million and have $9 million in the pipeline. This will be important for supporting future expansion.
Of course, our tremendous growth is resulting in a need for additional talent, so we are currently recruiting. If you’re a talented engineer, developer or business women looking for an opportunity, please reach out.
ML: Know your product market fit before beginning the funding process. If you understand this and research what your competitors are doing, it will help you develop a unique proposition early on. This gives you a selling advantage and moves the conversation with investors along quicker.
All early-stage founders should ask themselves, “Do we need to take funding? If I do, how much do we need to take on and what will it be used for?” Knowing this in advance is critical to ensuring your investors are aligned with your goals. Make sure you take money from the right people who understand your company values and can provide strong direction with their operating skills, extensive network or follow-on money.
As an example, we were comfortable working with Golden Seeds because their mission aligns with ours. We value the organization’s commitment to build wealth for women and create opportunities for gender-diverse companies.
ML: Some of the most valuable aspects of Golden Seeds include the diverse expertise of skills and relationships you gain from the network. Golden Seeds brings together some of the strongest, most powerful women in the U.S. and they work together to support up and coming women-led companies. No matter what industry you’re in you can find Golden Seeds investors who can introduce you to someone or something that’s relevant in your industry.
The organization is always reaching out with mentorship and advisory guidance. They can provide hands-on or hands-off assistance, depending on what you need. And it’s great for those who are looking to invest in women-led companies because you will be part of that next generation of successful women.
For more wisdom like this from other amazing female leaders, follow Golden Seeds on Twitter.