Tech tycoon sees future in Internet ads

The past decade has been a boon for Internet advertising and business, and at just 26 years old, Jan Barta is a veteran of the industry. After starting his first Internet company in 1999, he went on to found mobile marketing venture B3 Net, which ran advertising campaigns for blue-chip companies like Pepsi and Toyota. Among the more than a dozen companies he's involved in today, one of his most high-profile enterprises, Elephant Orchestra, has expanded rapidly after just four years to include three branches that monetize traffic to Internet domains, sell customer leads to companies and sell targeted Internet traffic.

The Prague Post sat down with Barta to talk about where digital business has been, where it's going and whether there is another tech bubble on the horizon.

The Prague Post: Elephant Orchestra is one of your bigger companies. What exactly do you do?

Jan Barta: I'll use some jargon: It's a vertically integrated traffic acquisition company. The domain business is how it originally started, and it involves us buying a lot of domains. They receive natural type-in traffic, and then you sell advertising on the domains and make money on that. We then decided to go into lead generation, which is pretty big for insurance and the banking sectors. We supply them with leads that we acquire online from people filling out forms to get insurance or loans. The third bit is Elephant Traffic. We deal with advertisers - mostly U.S. advertisers - who buy traffic from our portfolio. Altogether, we are about 60 employees now.

TPP: How has online business changed since you first entered the sector?

JB: It hasn't been so dramatic. There are a lot of technological developments. Four years ago, people didn't know much about Facebook. The way people navigate the Internet or how they use mobile phones has changed a lot. In our domain business, people don't type domains into address bars as much as they used to, because they have different ways to navigate, but the change isn't that huge.

TPP: How exactly does one monetize a domain business?

JB: Let's say you are looking for shoes. A lot of people would type "shoes" into Google. But a slight percentage of people will type "shoes" into the address bar with ".com" and hope they find something about shoes. It works because there are so many people in the world, and even if a slight percentage navigates this way, we can make money. For my own personal domains, there are 700,000 to 800,000 people per day that hit them, and then I sell advertising, usually syndicated by Google, so anytime somebody clicks on the advert, I make money.

TPP: Is there much room for growth in that business?

JB: The huge growth is behind us. When I started in 2007, I was already very late to the business when it came to domains, but I found interesting ways of breaking in. But now it would be very, very difficult to enter.

TPP: What do you think the next big thing for online business is?

JB: I always somehow try to ride the trends, and so one is definitely social. The way people navigate online is changing. Five years ago, when you were looking for something to do on a weekend, you would google whatever to get tips. And now people post a question on Facebook, and their friends answer. Like, "What should I do over the weekend? Does anyone have a good weekend retreat?" Interactions between people are growing in importance. And then another big trend is smartphone usage and various applications of that.

TPP: What are some ways to monetize on the social networking trend?

JB: I strongly believe there is a rise in precision targeting advertising. Facebook has all this information about its users, and there is a way to specifically target an ad based on the interaction of the users of Facebook. Google, for example, when it comes to searches, really relies on contextual information and the information on a page. To use an analogy, in medicine, there's this whole sort of future in how you analyze an individual's genes, and based on that, you'll be able to tailor-make a certain type of medicine for that person, whereas today it is just a sort of mass bombardment idea. That really applies to the future of the Internet. Things will be much more tailor-made for individual tastes.

TPP: You started working with Internet companies early on. How did you first get into the business?

JB: Since I was 12, I had this interest in the stock market, and this was back when the whole tech bubble was forming in the Nasdaq. I was watching all these companies go public, like eBay and Yahoo, so I got interested in that and decided to invest a little bit of my parent's money. I obviously ended up losing a lot of it when the bubble burst, but after that, I decided I might develop my own Internet businesses.

TPP: What's your take on the speculation of another tech bubble happening?

JB: Well, there's surely a certain bubble developing, but being aware of the first sort of bubble in 2000, I feel the fundamentals of these companies are much better than the companies in 2000. Back then, these companies going public were just selling, buying some kind of promise and burning tons of cash. Whereas today, a lot of these companies going public really have a viable business model, like Linkedin, Zynga and Facebook. These companies are making money and growing fast. Just a few people might get burned, but they won't end up losing all their money like they did in 2000. The bubble forming is a bit different than in 2000, but we could still be in the beginning of the bubble, and it could inflate to crazier things.

Cat Contiguglia can be reached at
ccontiguglia@praguepost.com