Michael Altendorf, who was born into a family of rural bankers, says he was inspired to enter the Internet business after reading Bill Gates’s 1995 book The Road Ahead.
He started his entrepreneurial journey in 2007 by creating a digital advertising business that rode on Facebook’s coattails. But as is almost always the case for entrepreneurs, the trajectory was not smooth.
“We had to pivot two or three times and come to near death before we found what did the trick,” says Altendorf.
Eventually he forged his own path, pivoting Adtelligence, the company he founded, to help brands use Big Data to optimize their websites to convert browsers into buyers.
The Mannheim, Germany-based business was named a 2014 Technology Pioneer by the World Economic Forum in recognition of the potential its technology offers to influence and shape the future of business and society.
And, in November 2014, Adtelligence was included in Deloitte Deutschland’s Fast 50 list, one of only three German companies singled out as “rising stars.” The company grew 584% between 2011 and 2014.
It wasn’t just Adtelligence that took a circuitous path to success. So did Altendorf, who chose to do interdisciplinary research for peace and sustainability in Heidelberg as part of his military civil service.
Instead of heading off to Silicon Valley, he then began working for Germany’s SAP, a global provider of enterprise software, where he was responsible for market intelligence and product management, while simultaneously working on a master’s in Economics from Ruprecht-Karls-Universität Heidelberg.
Altendorf worked in the same department as Shai Agassi, a high-ranking, high-profile SAP executive who later went on to found the now-defunct A Better Place, an Israeli car company.
The German software company was buying a lot of start-ups at the time, which made working there exciting, but the founders always left, recalls Altendorf. “So I had to ask myself why?”
From Peace Studies To Smart Ads
Born in Weinheim, West Germany
Elects to do interdisciplinary research for peace and sustainability at FEST, Heidelberg
Conducts market intelligence at SVP Deutschland
Market intelligence and product management for emerging solutions at SAP
Earns BA MS in economics from Ruprecht-Karls-Universität in Heidelberg
Launches Adtelligence and takes on the role of CEO (co-founder Cyrille Waguet continues working for SAP).
Guest speaker at World Economic Forum, Davos; TEDxRheinMain; Universität St.Gallen; Salzburg Universität; Mannheim MBA School; Haas School of Business, University of California
Creates Rhein-Neckar Technology Ventures and a regional entrepreneurship club that has allowed more than 200 start-ups to pitch to VCs and angels, resulting in more than 30 funding rounds
Adtelligence is named a 2014 World Economic Forum Technology Pioneer
Adtelligence is included in Deloitte Deutschland’s Fast 50 list and is one of only three German companies singled out as “rising stars” after exhibiting 584% growth between 2011 and 2014
“Today SAP has incubators and start-up programs that were missing back then,” says Altendorf. In 2007, when he was thinking of launching his own start-up in Germany, raising capital was tough. And about six months later it got tougher after Lehman Brothers collapsed.
Then Altendorf met Marco Rodzynek, a partner at NOAH Advisors, the corporate finance firm behind the NOAH Berlin conference, at a private club in London’s Mayfair.
“It was like that scene in the Facebook movie where Sean Parker says, ‘a million dollars isn’t cool. You know what’s cool? A billion dollars,’” says Altendorf. “Marco explained the world to me, told me he could introduce me to investors and started pinging them right there. Then he plunked down something like £100 for breakfast.”
Adtelligence raised around €5 million from 10 angels, including Rodzynek, Harold Mechelynck, founder of Belgium online payments company Ogone, which was sold for $484 million to Ingenico in 2013, and Carsten Thoma, a co-founder of hybris, an e-commerce software provider acquired by SAP. Jörg Sievert, a venture capitalist who worked at SAP Ventures from 2007-2011, is an advisor.
“The basic idea at the beginning was to take the data from social networks and match it with advertising,” says Altendorf.
“At the time Facebook did not have advertising in place so we thought, ‘let’s do an ad platform that is a super precise targeting engine.’ The problem was we were much too early.”
Eventually Adtelligence became the first Facebook advertising platform partner, but “after one or two years they just started copying all our features,” says Altendorf.
“It was the classic case described in Geoffrey Moore’s book Crossing the Chasm. Use the middleman until you are strong enough to cut them out. That is what happened.”
Facebook walked off with the market. eMarketer estimates that the social network will generate $15.5 billion in ad revenue in 2015, which represents 65.5% of all social network ad spending worldwide, a slight increase from the 64.5% of the market it owned in 2014.
So Adtelligence has set its sights on another lucrative market, helping online merchants personalize their advertising.
Digital ad expenditures are projected to nearly double between 2012 and 2016, increasing to $163 billion from $87.3 billion.
If pundits are right, the effectiveness of those ads will depend largely on personalization.
The companies that understand how to operate in this new environment are hot. Consider Criteo, an ad-targeting company that prices and supplies personalized advertising in real time for its e-commerce clients. It listed on NASDAQ in 2013 in an upsized IPO that further increased excitement around the sector.
“We are going from a totally anonymous Internet — where we knew a bit about you, but not everything — to a totally personalized web where we know everything about you,” says Altendorf.
‘Consistently Accomplishes More In 24 Hours Than Any Individual I Know’
Adtelligence works with more than 100 clients, offering them technology that customizes web pages on the fly.
The company is looking to raise up €10 million in the next 12 to 18 months to fund its U.S. market entry, Altendorf says.
In addition to running the company and fund-raising, Altendorf is a co-organizer and speaker at TEDx RheinMain; is the co-founder of an entrepreneurship club near Mannheim, which organizes monthly networking events for CEOs and investors; and is the organizer and co-founder of Rhein-Neckar Technology Ventures, a matchmaking event for entrepreneurs and start-ups.
Oh, and in his spare time he does some angel investing and helps organize Maifeld Derby, a German music festival, which this May attracted some 50 bands and 10,000 visitors.
“God gifts us with 24 hours in a day — that is it — but when I think about Michael Altendorf the thing that I find amazing is that he consistently accomplishes more in 24 hours than any individual I know,” says Dave Darsch, founder of both This Way Up!, an event for Chief Executive Officers in Europe, and the CEO Collaborative Forum, a community of CEOs who are global, high-growth and willing to help other CEOs.
“One minute Michael is in Osaka, on his way to a World Economic Forum meeting in Tianjin, then he is in Silicon Valley in meetings, the next thing you know he is off raising funding somewhere. The business side of me really admires him.”
Altendorf has been a regular attendee at the CEO Collaborative Forum for the last four years.
“Some CEOs suck everything they can out of all of the other brains,” says Darsch.
“Not Michael. He is willing to give his time to other CEOs, to collaborate with them and guide them in accelerating their growth or avoiding mistakes.”
There is another quality that people who know him say sets Altendorf apart: his boundless ambition.
“Germans have a problem in that they sell really early,” says Altendorf. “Everybody knows how to start up a company, but few seem to know how to grow companies.”
So what does the road ahead look like for Adtelligence?
“We have the opportunity to become a $100 million company or beyond,” he says.