A Canadian Company That Beat the Odds to Become a Global Powerhouse
It can seem almost impossible to open a newspaper or visit a Canadian business news site these days without being bombarded with the pessimistic mantra that Canadian businesses (and entrepreneurs) are risk-averse, conservative and doomed to play second-fiddle to our southern neighbour in the innovation orchestra of the online world.
Here at Dx3, however, we don’t buy into that kind of thinking. That’s why we recently unveiled our “Made in Canada” series. Each week on the Dx3 Digest, we highlight a Canadian startup that took a chance, dreamt big and is now stepping boldly into the global marketplace.
About Casale Media
The more time you spend interviewing Canadian entrepreneurial success stories, the more likely it is that you’ll become accustomed to a particular chronological progression that many of them often seem to share. This narrative usually follows the pattern of a plucky home-grown Canadian business that spent its early years carefully building strength within our borders before striking out into international markets from a position of strength. After devoting the first four entries in our “Made in Canada” series to companies like Well.ca and Beyond the Rack (which both followed this path), I had come to suspect that this familiar narrative was the status quo for all successful Canadian startups from the last decade or so.
Earlier this week, however, I sat down with Andrew Casale (VP of Strategy at Casale Media) and that assumption flew straight out the window. Instead of spending years in Canada preparing to expand outward, Casale found success in the States early in their company’s lifespan. It was this strong foothold across the border that instead helped bolster their efforts here at home.
As an advertising network and media technology company, one of the biggest in the country, Casale Media is proof that there is no one path to success for entrepreneurial Canadian businesses.
To paint an accurate picture of how Casale Media set off on the road to global competitiveness, it’s first important to look at what the world of digital advertising looked like back when the company was founded in the early 2000’s. Andrew shed some light on this period of an “industry at a crossroads”.
“Back then the ad network category was nothing like now,” Andrew explained. “There were very few players and publishers were just numbers to their networks. They got cheques in the mail and had no control over how they were represented. There was no transparency.”
Also compounding the woes of publishers at the time was the fact that most established ad networks were American rather than Canadian. This, coupled with the frustrations many publishers had about the black box nature of the industry’s biggest players, lead to a eureka moment for Casale Media’s founders. As Andrew elaborated, “It felt like there was an opportunity that was not being taken advantage of so we created a system where we could pay other publishers to promote sites and advertisers we were working with. That evolved very quickly. The key value for us was transparency and control.”
Then, in 2003, Casale Media officially launched its display advertising network. What is particularly important about its unveiling, however, is the route they took to achieve it.
“Our platform took roughly 2 years to build. We invested in the project with our own capital base and we didn’t go outside for investment. We also did all our development in Toronto with recent grads. We found younger talent was easier to mould and since we were doing something that was outside comparative examples, we felt we had to avoid bringing in any outside preconceptions or old habits. We also developed right through the massive North American power outage – we had a generator going. It was a very hot few days but it pulled us all together.”
It certainly did, as Casale Media’s display network is still alive, well and thriving nine years later.
Challenges & Being a Startup in Canada:
Aside from power outages, one of Casale Media’s most significant challenges came in the form of substantial resistance from Canadian publishers who were hesitant to accept a Canadian solution. In fact, in order to succeed Casale Media found itself having to go south of the border to get off the ground before returning to Canada several years later.
According to Andrew, “being Canadian and being based in Toronto, we really wanted to do more in Canada but we were actually met with some very extreme resistance At that time everyone in the market was basically tethered to whatever solution they were using. We discovered the market here was not receptive to a Canadian solution and that, at the time, it was almost a stigma for to be selling a platform built in Canada. We tried very hard and put a lot of resource and effort into building it (2004-2005) and at some point we realized the market was too hyper conservative and comfortable with existing solutions.”
It was at this point that Casale Media built satellite offices in the US. “That’s when we really started to take off,” said Andrew. “It’s strange to say, but we got a fairer shot selling in the US than we did in Toronto and Canada at the time. This was because we built our product to the US standard at the time, which was still far ahead of what most Canadian publishers were comfortable with. We had the right product, but too early.”
Fortunately, after building momentum in the US over the next few years, Casale Media gave the Canadian market a second shot in the late 2000’s. Interestingly enough, Andrew told me that in certain circumstances Casale’s now strong foothold in America lead to them being received much more positively by Canadian publishers. “We found that some Canadian companies now thought we were a big American company and were much more receptive to our platform as a result.”
Andrew went on to describe the key difference they observed between the two markets:
“Our market is a lot less fragmented and it’s much more consolidated. In the states you have smaller players that can operate autonomously while maintaining great scale but you don’t find that in Canada because the market is smaller. Canada has a more corporate approach with more oversight so as a result things don’t move as fast.”
Today, Casale Media is a major player in Canada as well as the states. And although they had to get their footing in America before finding success in Canada, Andrew assured me that it was triumphing in the latter that meant the most: “We’re very proud of our roots though and telling the Canadian story worked well for us. We’re now #2 or #3 in canada behind Google and AOL.”
Advice for Other Aspiring Entrepreneurs:
Despite the initial resistance Casale Media experienced in Canada, Andrew’s advice for aspiring entrepreneurs is to not allow yourself to be discouraged. “If you encounter resistance in Canada, learn from it. If it seems insurmountable at first, I’d definitely recommend trying your hand in the much larger market south of the border. It might just be that the market isn’t ready for what you are offer. We see Canada lagging behind 18-24 months today, so if you build something to the US standard here… you need to be careful that your timing is right.”
As a good example of the precariousness of timing, Andrew went on to mention the current real time bidding craze sweeping the online advertising industry in Canada.
“Be careful to be in the right zone of the bleeding edge of new. RTB is a great example of that. If you look back a year in, RTB was a huge trend. But Canada was still learning and questioning and there was a lot of hesitancy… Major companies were saying ‘What is this? …maybe I can try it if I’m using it as a small test….’ But if you look at it today you won’t find a publisher or agency who hasn’t deployed an RTB strategy.”
Finally, perhaps one of Andrew’s most salient points of advice for business leaders in organizations small or large was to never underestimate the value of meeting face to face.
“When you’re talking about business development,” he told me, “proximity does really matter. Face to face contact is king. When we were selling in the US before satellite offices, we defaulted to phone or email because we were young and travelling is expensive. However, we really only started to get traction when we put people in front of people. It’s a very valid lesson that when you’re in the heat of building a product/business and it’s all on your time, you might de-prioritize efforts like that because you can send a hundred emails from your desktop but can only do four meetings in New York or Toronto a day… but the weight far exceeds the value.”
This holds true especially, he went on to add, in the case of trade events.
“We participate in a lot of trade events and that’s a lot more valuable than trying to visit 3-4 markets. If you can find an event where all your ideal clients will all be at the same time, however, then you can meet with a wide array of people all at the same time and get a lot more value. There’s really nothing else like it.”
With a well-established presence in the US and the third largest share of the Canadian display advertising marketplace behind only AOL and Google, the future is bright for Canada’s own Casale Media. As Andrew related to me near the end of our conversation, however, they’ve only just begun.
“For us it’s about removing a lot of limitations that we imposed on our business for our first few years of growth. We were looking to grow in a controlled way or else we knew we’d end up trying to be everything to everyone. Instead we limited ourselves to focusing on US & Canada and when it came to interactive formats we limited to display. Now, however, we’re excited that we’ve begun to deploy our first infrastructure outside of North America in Europe. We’re also on track to deploy infrastructure in Asia as soon as Q1 next year.”
Ultimately, Casale Media’s increasing success outside of (and within) Canada’s borders are what makes it a fantastic example of a local success story. Andrew Casale agreed with my assessment.
“I think we’re a great example of the fact that you can build a business in Canada and compete in the US and compete globally. You can do that until this market is ready for it. We have a great amount of talent in Canada and it’s a great place to do it.”
Casale Media is proof of that.
Stay tuned to the Dx3 Digest for our ongoing “Made in Canada” series: