FraudScore CEO and COO interview: success story, advice and personal experience in ad fraud fight
Dmitry Isakov, CEO, Co-Founder: Dmitry has been working in IT-industry for about 20 years. Lots of challenges, ups and downs, being a CEO, CTO and crisis manager. He has managed software development from small utilities to multi-million MAU online games publishing platform and mobile apps. Before FraudScore he has (co)founded several companies in mobile ads field. And as soon as he faced the “dark side of the ad-force” he decided to put all his efforts into making ad market clean and transparent by fighting fraud.
Alexander Shirinkin, Co-Founder, COO: Since early age, Alexander has always been keen on learning and working with new technologies. In 2002 he started as a system administrator and, in years, he has grown to a position of COO and co-founder of FraudScore. Alexander has worked as top manager in several companies in game development and online advertising. While working in online advertising, Alexander was stunned by the amount of ad fraud in the industry, and he has decided to establish a SaaS company that will be helping businesses in fighting ad fraud and protecting good reputation of reliable companies.
How did you meet and start the project?
Alexander: We have been working together for the last 10 years. When we’ve established a company that was working with mobile advertisement — we’ve started to notice “fraud” — there always was some malicious activities and suspicious traffic that we didn’t trust. But almost no one could explain what was that. So we’ve started to dig it and step by step managed to develop one of the most efficient antifraud platforms on the market.
When did you launch it?
Dmitry: Originally FraudScore was found in 2015 in Russia. Our Spanish company has been found in 2019, after we’ve won “Rising Startup Spain” and for a great chance to broaden our borders to European market and fight ad fraud here.
What are the keys to creating a team that works?
Alexander: I think that there are several criteria that make a good team. First — share the same approach to the problems that your product is solving. All team members need to see the trouble and understand how malicious and bad it is for the customer. Second important thing — is the team members and their personalities. It’s not easy to find different people with different characters and points of view that are united with one product and its purpose. In FraudScore we’ve managed to do that and we are very proud that our tech, sales and support teams are working as one.
What gives you the entrepreneurial experience on a personal and professional level? Why would you recommend it?
Dmitry: I’ve been always keen on creating new things. Those things that didn’t exist before. And every time a process of creation is a challenge: technical, marketing, managerial, financial… How to start a new project when your resources are limited?
Many years ago I’ve started everything by myself — by trial and error. Later, I got an education in management for technological start-ups and that helped me see many things differently. That’s why I recommend to new entrepreneurs to undergo such acceleration or training — either in full-time or in absentia.
Would I recommend “a path of an entrepreneur”? I’d rather not) Because it’s my firm believe that you can’t recommend someone entrepreneurship as a way of life or thinking. You must have it inside you. If you like creating things, if you have a lot of ideas — then probably entrepreneurship is for you.
You have to constantly keep creating new things — for product, for promotion, for management and business development. Do you need investments? How to find right people for a team? What features need to be added to a product next?
It reminds me a chess game. You have to constantly keep thinking about the next step, and about several steps ahead. Only then you are doing and managing an international business (global) and you compete with major global IT players. It’s complicated but also really exiting.
If you are interested in all of this — then welcome to the Club. There are no guarantees for success — but one thing is certain — you won’t be bored.
And one more important thing. Everything here is changing extremely rapidly — the market, technologies, approaches… Unlike most traditional businesses, you have to run much faster on this market…
Why has fraud on mobile devices grown so fast?
Alexander: People’s life becomes mobile — a user can now order food, get medical advice, meet and date with interesting people from his mobile phone. And not to mention ordering groceries, transportation and take out from the apps. 2018 was named as the year when an average user has spent at least 32 whole days in his mobile phone. So the devices are either rapidly developing and upgrading and, at the same time, become more available to users all over the world. The more users — the bigger is the market for mobile advertising. According to the international marketing forecasts in 2019 online advertising is about to take 47% of all global digital ad budgets. (The number will rise up to 51% by 2023). The bigger are investments in the market — the more tempting it is to the fraudsters. FraudScore statistics for the first 6 months of 2019 has shown that almost 35% of all mobile traffic was fraudulent. Statistics say that in 2019 advertisers and marketers might lose up to 25 billion USD.
How did you specialize in this sector? What steps did you follow?
Alexander: As I have already mentioned — we’ve started in online advertising, particularly working with CPA campaigns. We were working with incentive traffic and providing advertisers with users for their CPA campaigns. And we’ve started to receive some suspicious traffic in our system — either huge amount of new users from one IP, or one GEO location in a short period of time or in an unusual time of day (at midnight, for instance). That’s how we got acquainted with fraudsters. Next — we’ve started to build our protection system to detect such activities and stop them or report to our customers. And we’ve kept on developing and improving it for internal needs. Then, we stated helping our partners with reading the statistics and detecting malicious activities. Until we understood that this its own market fit. And we’ve decided to step away from advertising and move our efforts and resources to fighting ad fraud.
You have analyzed millions of conversations, what kind? What process do you use and how do you guarantee safety in the process
Dmitry: In terms of security and reliability of our platform — we possess our own developed know-how platform and pipeline for data pre-processing, storage and processing. We base our technologies on the trustworthy solutions from the world-known server providers.. And these two instruments combined allow us a batch processing in multiple asynchronous threads almost in-flight.
As for the security — we thoroughly and constantly (24h) monitor external and internal data metrics at each stage of processing, reliably provide security, duplication and reliability of servers and services on our own.
What clients do you work with? What profile do they have and why do they choose you?
Dmitry: FraudScore specializes in all the types of online campaigns and detects and prevents ad fraud on every stage of advertising funnel. We work with CPI, CPM, CPC and CPA campaigns, as well as with programmatic campaigns. Our solution is also developed to process both mobile and web traffic — that gives us an opportunity to work with any type of a customer in online advertising — app and game developers, advertising agencies, affiliates and affiliate networks, direct advertisers. And we also don’t have any limits in terms of traffic quantity — we work with either small companies and huge industry players. Among our customers and partners are: HeadWay, Kimia, RedTrack, Affise, Admitad, CurateMobile, Kismia, ZimaAd, Mozoo and many others.
How do you integrate in your day to day and on your platform?
Dmitry: We provide integrations with all popular tracking platforms on the market as well as server postback, Pixel and JS-tag integrations — depending on the needs of a customer. Any user can setup an integration using our “Integration Wizard” — when a user selects what type of traffic will be checked for fraud. The next step — choose a platform from which FraudScore will be receiving traffic. The system tells a user what data is needed to set the integration — IDs, keys and scripts for integration. We also keep working on new integrations and platforms because the market is so rapidly developing and new sources appear.
What support have you had in this regard?
Alexander: FraudScore provides its customers with 24/7 tech support. For now — it’s in English and in Russian. Each customer get a personal manager, who is responsible for all the communications, requests and issues with his customer. Personal managers help the customers on every step of working with our platform. At the integration and trial period — personal manager leads a new customer through all the technical steps. If needed — our tech team joins the process. Then, after the trial period — personal manager helps the customer deal with fraud reports — research, detect particular fraud cases, understand and read the statistics. After the first couple of months almost every customer gets so used to working with the system, that personal manager just keeps an eye on his client and gets feedback. In case, of a manager is unavailable to answer asap — our Customers support team is available 24/7.
How does a company change before and after using Fraudscore? What improvements do you notice?
Alexander: We have two main principles that rule FraudScore work for its customers: reliability in ad fraud detection and user-friendly reports for specialists that are not fraud-professionals. So we’ve managed to combine these two principles in our service and product — high efficiency fraud detection platform and fraud reports for users who use it everyday. Reviews from our customers say that thanks to FraudScore their employees (traffic managers) save up to several hours everyday on dealing with fraud reports and explaining it to the partners. Usually our customers are not fraud-experts and providing them with reliable and simple reports — save them time and money. Money is saved thanks to both — effective fraud detection and comprehensive fraud reports.
How did you establish your business model and what plans do you offer today?
Dmitry: We use SaaS business model. We’ve selected this approach because it suits the needs of our customers — it depends on the volume of traffic that they have every month and can be adjusted. For example public plans for CPI campaigns start from $490 per month for 30 000 installs. But there are different discounts available for those who pay in advance for several months or a year.
What does it mean that you offer a 99.5% uptime guarantee on all paid plans?
Alexander: We work with huge amount of data- we must provide our customers with high stability and security of the service. Our developed pipeline guarantees 99.5% reliability and our customers are aware that we have 24/7 tech support and know-how monitoring systems that helps us be one of the most reliable third party anti-fraud solutions on the market.
How has ICEX helped you in your incursion into the Spanish market?
Dmitry: We were really thrilled to learn that we’ve made it to the winners list of Rising Start-up Spain 2018. On the one hand — it’s always a pleasure to get recognition on international markets. And on the other hand — it can help us promote our service to local European markets. Thanks to ICEX we’ve managed to quickly solve all the legal, organizational and financial issues and established a company in Spain. Also, ICEX provides an office space at Telefonica coworking, and when the program ends ICEX covers 10 000 Euros of expenses that we’ve had this year.
ICEX representatives are always open to answer my questions and assist on every step: visas (when we were planning relocation to Spain), company foundation and other agenda. If I am having questions (and to be honest — setting up business in Spain is pretty bureaucratic) — I first turn to ICEX for consultation. Of course, you are able to set and found a company in Spain by yourself, but for international startups ICEX is a great help and option. If you don’t speak Spanish — it’s hard to deal and solve some issues.
What has been the reception of it and why did you choose it? How is it different from other regions where you are established?
Dmitry: Frankly speaking, it’s hard to say now. We are a new company on the local market and it’s yet hard to evaluate and mark Spanish specific demands and characteristics. But one thing we have already noticed — everybody in online advertising business are speaking English. That really helps to an international company to feel accepted and ready to be worked with.
What elements are essential when internationalizing a startup?
Dmitry: I think one of the most important things is to “think global” and see your product as valuable to any customer all over the world. When you think global — you are ready to study and research new markets, their requirements and expectations. Be ready to do the field search, organize meetings,visit local events and meetups. All these will help in understanding the market (including culturalusiness specifics) and foreign customers specific demands of the foreign customers.
If is also important to comply with international laws and regulations — you need to be sure that your product satisfies the requirements and goes well with the international restrictions. For instance — to work on the European market you need to comply with GDPR. We’ve spent some time to become fully compliant with it.
It’s also very useful to find an alliance or partnership at the region in order to reach more customers and have a proof that you are a reliable and trustworthy business. Thanks to “Rising Startup Spain” — FraudScore has that opportunity — we have the support of ICEX who believe that our product is of a great value and importance for the European market.
What goals do you have for 2020?
Dmitry: In 2020 we are planning to develop and grow our European sales. There are also plans to hire the local business development managers. Thanks to ICEX we have a great opportunity to have a solid ground for our businesses in Europe and 2020 is going to be a year when we develop our efforts to that.
Alexander: In terms of the product — we are going to develop and release new fraud detection and prevention patterns, including the OTT & Google ads etc. Our product goals are connected with new mediums of online advertising and ways to protect it from fraudsters.
Dmitry: We are also aiming to participate in the majority of Spanish and European events and conferences — for Instance AWE Barcelona 2020, Mobile World Congress in Barcelona, DMEXCO 2020 in Germany and many more.
And a wish?
Dmitry: We wish that more companies in online digital advertising become aware of ad fraud and there were more transparency on the market. Companies need to acknowledge that no matter what type of campaign there are running — ad fraud is there. It’s very common when companies “close their eyes” and simply pretend that fraud is not there. It can happen because of a fear to lose a valuable business-partner and contract. Or sometimes it happens because companies don’t use a third-party anti-fraud solution and rely on services that are provided either by an advertising platform or by a company that is affiliated with this platform. It leads to simple conflict of interests — no one wants to admit that their traffic is fraudulent. So that is why it is so important to have an independent anti-fraud provider — like FraudScore — who would guarantee unbiased fraud detection and reports that show a real picture.
We are looking forward to 2020 as the year of new markets (Spain and other European countries) for us and we are always open to conversation and request from potential partners and customers.
You can either book a meeting with one of our business development guys to get a personalized walk through the FraudScore platform.
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