A few weeks ago I had the opportunity to talk with Michael Amar, CEO Ifeelgoods, a digital rewards platform, that very literarily, competes against the idea of discounts. They favor providing rewards for a variety of actions and relationships, including CRM, advertising, loyalty programs and lead generation.
An interview with ifeelgoods CEO Michael Amar
[This interview has been edited for clarity and readability.]
Karine Allouche Salanon (KAS): Why is your company so different from other companies, how do you maintain that differentiation?
Michael Amar (MA): There are many companies that do few thousands of billions of dollars, who send out discounts. And when they’re going digital like a lot of older companies they just do a copy and paste? Instead of going to Safeway, people go to Safeway.com/gift cards. But users are not going to Safeway.com/giftcards right? They’re on Pinterest, they’re on Twitter, they’re on Facebook – they have their businesses setup on Slack, on Zendesk or Salesforce. So we’ve built a solution that allows us to distribute rewards where the young consumer might be.
KAS: So I always forget my cards. I can use your rewards for anything that I would normally use reward card for.
MA: And instantly, that is the big difference.
KAS: Okay, good. So you’ve won the award, and we’re talking about a lot of success of startups. I was reading and highlighting some myths, one, specifically from France: ‘Oh it’s easy to hire and fire,’ which is not so easy in France. And also the my that in America, ‘it’s going to be so easy because so many people are successful.’ Can you tell us a little bit more about your journey? Did you find it easy?
MA: It’s super difficult every day. We have the luck to be bi-cultural, we get the best of both worlds. That’s helping us a lot. But it’s extremely difficult. I came here, I was not that young (like 35 years old) and you know, I speak English – I’d already done business with the U.S. many times. I was, like, ‘Okay it’s not that difficult, not different, even if I didn’t know specifically people in the area.’ But then everything was different, right? If you do business in Japan, in your mind you know that it’s going to be completely different. You have no preconceived idea. You know everything will be different. In the U.S., you don’t think so. You think it’s going to be exactly the same or very similar because we think the culture is the same and the language is the same. But that’s actually a complete mistake.
So I learned the hard way. I think I made every mistake I could do, many times. But America does have culture of success. If you have kids, they listen to teachers, the way they describe success. The only thing I could say when I arrived was I sold my previous company. That actually helped me a lot. They didn’t ask me if I sold it for $10,000 or for more [Yes], so just mentioning creating a business and selling it, it actually opened a lot of doors and helped me kick off the full process.
The way VCs write the terms is very different. I found that everybody wanted to screw me. It was just the way it’s been done for 70 years, so everybody wants to screw me, right? But when you read it and they talk to you about vesting, and they say, no, it’s not your company, it’s going to be your company in four years. No, I said, it’s my company and I can give you some part of it, right?.
The aggreement langauge – the way you manage employees, partners, and clients is so different. So I think it’s actually very tough because everybody expects the best of the best? When I talk to people here they run ultra-marathons – Okay I can run 5k. But it is the same for everything, right? That makes it difficult for financing, for management, for doing the deals. The culture of success makes it so people don’t talk about the failures. Everybody, even if a guy is going to lose his company tomorrow, he will say ‘Great, everything is all right’.
KAS: Yeah, I remember the founders from the Petit Pots, one of the other winners of French-American Business Awards — during his speech, you know, when he was there, he said ‘There is such a fine line in between failure and success. I just got my order from Whole Foods and I might get bankrupt because I just don’t have the funding to, you know, give it support’. You know that line is really a very fine.
MA: I have exactly the same story. I closed my biggest deal in my career a few months ago. But half an hour before, my CTO, who was instrumental in executing the deal, left the company. The next day a VC with whom I have closed all the terms changed all the terms, so we couldn’t accept his terms. It was in 24 hours. You have those ups and downs. Actually with more experience and getting a little older I find I’m never super happy, but I’m also never super disappointed. I try to stay even. The reality is that if you have to eat sand every day, say it’s good and you want some more.
KAS: Yes, it’s a good way to look at it. So what do you do to stay not too happy or not too unhappy? And eat the sand, smiling.
MA: I think it’s the life lessons and progressing. But I like to compare with soccer. So when you come here, it’s like you played in Valenciennes and you played with Basa. It’s quite a different level. But also if you are not gifted – and I don’t have a special gift. I’m not good in tech, I’m not good in finance, so I didn’t have any specific skill. So you just have one thing – you know how to run and fight, and then you go running and fighting.
KAS: As I was preparing, I was going to ask you about three characteristics that make you successful. Humility looks like it woul dbe one. Just hearing you say, ‘Oh I’m not gifted, I’m not gifted’ But don’t people say ‘Come on’, you’ve achieved so much. Along with humility, determination or perseverance? Passion? But not passion like ‘Yay, he’s excited and passionate’; it’s like passionate in what you do with others—caring about others. Do you think those are the things that make you eat the sand smiling and achieve what you’ve achieved so far?
MA: Have you talked to my mother? (both laughing) Yeah, but I think it’s determination, yes, perseverance, it’s when you don’t have a choice, right? That’s…
KAS: You could have the choice. You have the choice to…
MA: of not creating companies, not being an entrepreneur, yeah. But once you’re in then…I don’t know what else to do, right? It’s my first company. It would actually be very difficult for me to comprehend not doing it and doing something else. It’s just a habit. Like, some people are comfortable in a corporate career and that is very good for them. I want to be an entrepreneur.
KAS: It’s part of who you are. Good. So does it help to be French, or not?
MA: That’s a good question. I thought not at all, right. Initially, but I was very surprised. I came here, got my first term sheet by a U.S. VC who could hardly understand my accent. And he came and said there were no preconceived ideas. That was pretty impressive. I came to HSBC the first time and they told me, ‘When you launch your business, just tell us. We might want to help.’ I was, like, ‘Come on’. With my previous company it was five years, you know, they wanted you to be profitable for five years before they would lend money, right? So it was very different. And there were no preconceived ideas. That’s one thing – there’s two angles to your question.
So being Frence didn’t impact me in a negative way. But surprizingly, it also helped. We met with one of those innovation labs a few years ago. They said, ‘We want your tech. We’ll give you exclusivity and a fee, and they opened the office in France for us. The French office became most of our R&D office, and the two-thirds of our team is there. So that’s a very good angle to to the positive side of being French.
KAS: Connections. I think that is a big value for the French American Chamber of Commerce. Is there anything you have you leveraged from the French American Chamber of Commerce that you would say helped in terms of the networking?
MA: Yes, actually the visibility we got through the award was amazing. We got press and very good vibes that came back from the event. That’s amazing. And the activity in general. We have a special program that helps young professionals go to a foreign country, and you get a tax deduction. That actually been amazing for us. We’ve recruited people that do on to places like Facebook. I’m very proud of them—though I would like sometimes to keep them a little bit longer. Usually we hire them for a couple years until they finish their internship. But that’s amazing. You’ve got the best of the best, right? Being associated with the best business schools or engineering schools. And the format is just amazing, for them and for us.
KAS: With so many entrepreneurs in the audience, let me ask, if you have one piece of advice to give an entrepreneur, what would it be?
MA: So if it’s people who are new to the idea, the area, one thing that helped me a lot is actually I try to compensate by hiring a lot of advisors. I think I’ve even pushed the limit of it, ten advisors. Give them some equity and it’s one of the best decisions I took, because most of them are entrepreneurs. They helped me for hiring, they helped me for the terms for new acquisition and for funding, they helped me with strategy, they were my psychiatrists sometimes (chuckling). So that was really, really helpful, introductions in business and…So I would say if it’s so new, like it was for me, it’s very good to get, you know, people who already know the system and have already been successful.
KAS: Now let’s open questions.
Q1: How do you see B2C versus B2B – how was that played out for your strategy?
MA: So we tried not to touch the B2C thing. I would love to one day to invest in B2C because the reason why, to be honest, my company, we’re only B2B, is that sometimes you want to tell the clowns to go elsewhere, and you can’t because they’re too big on your P&L, right? Or B2C if someone is not so happy that’s not death then, right? If it’s a single user among millions. So we try to help, we are very B2B, 2C actually. We sell to business who already sell to end consumers. Or sometimes there will be even more people in the chain. And we think that for the consumer if I give you a coupon, I give the same to Karine, I give the same to Etai, it’s a one size fits all, it’s over. If I give you loyalty points, you need 50,000 miles to get a free flight to Vegas, that’s over. So we think that giving a tangible instant reward, personalized, will be much more relevant. So if you know, because you’ve liked the page, you know, Apple or Wall Street Journal on Facebook that you would like a free subscription to WSJ or free iTunes credits, then I’m sure it’s going to be a better reward than a free coffee machine. So we use the traction that consumers have for those digital rewards and try to provide the technical solutions, as well as the content. I don’t know if that was the question, but…
The ifeelgoods echo system
Q2: Could you tell us a little bit more about the company, the size of company, number of people, revenues, etc.
MA: Sure. So a five-year-old company, 22 people, two-thirds stayed in France. We are mostly a product and tech company, with two business people, including me. We have live campaigns in 30 countries. Our main asset is the tech and being international. Actually, in the U.S., we’re not that strong. France and Japan are bigger than the U.S. for us, on the P&L. We do a few million dollars. We work hard to be on the next 20 million awards…[Plus] Yes. It’s going to take a couple years hopefully, no more. And we hope to be profitable by S1 next year. Yeah, we are pretty lucky to have good partnerships with Apple, Google and Amazon, and they’re helping us a lot, opening in new countries, and also they’re subcontracting some of their activities to us.
Q3: How much money did you raise?
MA: We raised $14M. Yeah, there’s two schools – everybody told me don’t raise too much. And at the same time, we had pivot, we had to pivot two years ago, we wouldn’t have been able to do it if we hadn’t raised that much.
KAS: If you don’t have enough money?
MA: Yes, if you do not have enough money. On the other hand, we’ve been throwing money out of the window. We know at the beginning, even by not telling ourselves, “Listen use the money,” right? But you get so much pressure, even if you’re in your mind, I shouldn’t do this, it’s still, ‘Oh I’m going to hire the guy from Google, right? And we made a lot of mistakes. So another piece of advice would be, like, be cash focused. Cash is king, cash is really king, even if you have the money. Until you really find the market fit, then you can pull an extra line if you need it.
Q4: From what I’ve read, it seems that signing deals in Japan was big milestone for the company? I just want to know, how did that relation get growth”
MA: We work Itochu, a very large Japanese conglomerate. I think they do over $140B in revenue. They own 500 or 600 companies. They also own businesses in France. It’s very typical for the Asian market. They own a large company called FamilyMart, which is like 7-11. They were already doing billions of dollars by selling physical gift cards a couple of years ago. But they also had B2B activities and they said, ‘Oh, the market is really booming. We need to do this in B2B’. So we got one of our advisors – hence why it’s good to have advisors – who connected with them. And Google was also a big supporter. So our trip was very strange. It was my first time in Asia, it was a year ago, and I’d never went anywhere there. I went with no translator. It was like a movie. I was completely lost. It took us seven months to close a three-year contract, and it’s a contract where they actually re-sell our platform. They have two people full time who are selling our technology to the Japanese market. What’s great for us, they sell it to all the verticals that we cover. So it’s distribution, partnership, they pay us a minimum guaranteed fee, and we have a revenue share. And they have very high expectations for their roles. It’s very good for us. We need more like them.
MC: Good. If no one has any more questions, thank you very much to you both.