Gil Elbaz Factual Essay

Gil Elbaz is an American entrepreneur, investor, and philanthropist best known for co-founding Applied Semantics (ASI), which was acquired by Google in 2003. He is the founder and CEO of Factual, an information-sharing startup.

He is a Caltech graduate, and the founder and Chairman of the Board of the Common Crawl Foundation, a non-profit dedicated to democratizing access to Internet information.


Gil Elbaz, Founder & CEO of Factual

Q: What does entrepreneurship mean to you and what underlying characteristics do you see in successful entrepreneurs?

Gil: In terms of the successful traits of entrepreneurs, the most important would be determination. In my experience, many times entrepreneurs have the right kind of intuition about how to solve a problem (whether that be a new one or an old one) and develop solutions that add value, but it can also take time to mature those solutions into a workable business. All too often people give up just because it is emotionally draining to keep trying, so determination and persistence become key traits that separate the best from the rest.

I learned a lot from being a long-distance runner in college. I was not a very good one, but I learned from my coach about pacing yourself and not looking too far ahead but, instead, feeding off of your passion for what you are doing. It's important to not be distracted by the 10-year journey ahead of you. One has to be emotionally tough and continue to take it step-by step, even when you are getting negative feedback and things are not gliding along nicely, keeping in mind that the sure way to fail is to just stop moving forward.

The best entrepreneurs are the ones that have a deep need to solve a problem that it is more than just a business opportunity. It is something that they feel like they were born to solve because it affects them personally or because they cannot imagine a world without this innovation. When you have that type of passion, you can't help but be determined to see it through.

Q: What are you most proud of in your professional career?

Gil: I am proud of the fact that so many of the people that I have worked with at Factual, and at my previous company, Applied Semantics, will say that they have had a positive experience working at the companies. I have not always done a perfect job, but I have certainly applied a lot of effort to try to understand each individual and what they are looking to get out of their career. This gets harder and harder as the company grows, but I have a firm belief that the best companies are the ones where people feel supported and ideas are coming from the fringes. Rather than top down, ideas are coming from all of the people that are interacting with customers, coding, working with data, etc. We've been able to create an atmosphere of respect where people feel empowered to come up with new ideas or make suggestions and believe that they can have a hand in influencing the company's strategy moving forward.

Q: If you could do something over in your professional life, what would it be?

Gil: I feel very fortunate that a lot of things in my career have gone right, but it took me a little while to get there, to find my way. I wish I would have gotten myself on the right path earlier and dug into things a little bit more. Right out of college, I made the mistake of choosing a career opportunity based on title and salary and it was only after the next two years I had realized that was a mistake. My number one objective should have been to figure out what kind of people I was going to work with, what I was going to learn, and if I would be empowered to push myself.

Q: Tell us about an instance where you had to go against the flow to realize your goal.

Gil: When Factual was founded in 2008, it was clear that investors were looking closely in two main categories - consumer apps and enterprise solutions. The idea of building a data company that is not going after consumer eyeballs or the enterprise and not even trying to directly solve problems (as funny as it sounds), but rather, serve as an enabler for others to be the problem solvers--was definitely going against the flow. Factual, is enabling everyone else around us to make consumers happy and businesses efficient. It's a new kind of platform within a company that works to be the hub of accurate, high quality data and to be a resource for all of the technology companies around us. It was sort of a contrarian model back then but today, it turns out that people can't shut up about big data and we're smack dab in the center of it all.

Q: Why did you choose to have Factual focus on location data?

Gil: Factual built a lot of data capabilities but we've chosen to really focus our effort on building the single best global location database on the planet. The reason we decided on this is that while everyone talks about how important online is, most human activity and most commerce still happens offline. People are still walking down the streets and living their lives in the physical world. There is a unique opportunity through mobile devices to bridge the offline and online, to compile and understand unique data about people, their contacts, their impact in real-time as they're passing a store, or walking by a park, or walking with a friend, etc

I started with this really utopian notion that we should programmatically root out errors from our daily existence and that we should build technology to automatically sift out accurate data from the biased, erroneous, or purposely false information. The world is just rife with this of kind data and it completely shapes the types of decisions that are made. This includes simple decisions like where I should buy gas or what I should have for lunch today, but also, very, very important decisions like what doctor I should go to or where I should live?

Q: If you were to give advice to your 22-year-old self Gil, what would it be?

Gil: Here is what's interesting: There is a lot I would actually like to learn from my 22-year-old self right now. As one goes through life, it's easy to develop certain habits and a certain way of thinking about things. It's really important to try to break free of those as often as you can and to re-think about problems with a completely open mind. Part of the reason we at Applied Semantics succeeded with AdSense is because we weren't bogged down with deep domain experience about how advertising "has always worked" and we came up with this idea for contextual advertising that we were told made no sense. Luckily we ignored the naysayers and followed through on what turned into a breakthrough.

Sometimes I wonder what baggage I am carrying today or, what assumptions I am making about what's possible or impossible. So my advice is, keep thinking outside of the box and, from time to time, step away and clear your mind of everything that is "industry-standard" in an attempt to think more like your former 22-year-old self.

Follow Gill Elbaz at @gilelbaz, and check out the other interviews in Going Against the Flow series at http://www.huffingtonpost.com/charu-sharma/ or thestartupsutra.com.

Follow Charu Sharma on Twitter: www.twitter.com/charu1603

Gilad (Gil) Elbaz has already lived every entrepreneur's dream. In 1998 he started a company, initially called Oingo, which later became Applied Semantics.

Applied Semantics built technology that connected related online content. In 2003, around a year before its IPO, Google bought the company for more than $100 million dollars, and used the technology to create AdSense, which automatically displays ads based on a web site's content.

As part of the deal, Gil joined Google, and headed up the company's engineering office in Santa Monica until 2007.

AdSense helped establish Google in advertising — its most important business — and earns it nearly $10 billion in revenue a year.

Most entrepreneurs would rest on their laurels, or stay at that comfortable Google job. Elbaz decided to take another crack at changing the digital world by starting Factual. This time, he wants to collect, and make accessible, as much of the world's data as he possibly can.

Its core database covers more than 65 million local businesses and points of interest in more than 50 countries.

We spoke to Elbaz on what he learned from his time at Google, why he's jumped back into the entrepreneurial arena, and why he thinks data is the future.

What he learned from Google

If you want to learn about creating an innovative company with a great culture, Google's a pretty good place to start. Elbaz was there right as the company entered a massive growth phase and helped create one of the products that sparked it.

He learned a few things along the way that he's applying to Factual.

"One thing that I learned at Google that I feel like I've applied is rigor to hiring. I think we did well at hiring at Applied Semantics, and I think we've upped the bar even more at Factual," Elbaz said. "What I learned from Google was to have independent thinkers evaluate people and to simply set the bar very high."

It's one thing to say you have a high bar, and another to do it in practice. Elbaz has a few pieces of advice for maintaining that high standard.

First, you need patience. Even if it takes a while to find the right person, it's worth holding out.

And second, though brilliant and focused people are essential, that's not all you need. "Obviously hard working, and focused, and smart; those are all key attributes. But I think what I've learned is that growing a culture is more than that; it's deeply rooted in people, their own personal motivations, and making sure that their own passions can be aligned with what we're trying to do as a company."

Hiring the best people is only part of the battle. You have to get the best out of them as well. Elbaz takes his cues from Google there, too.

"I think that Google is very much a 'bottom- up' culture, where the leaders readily admit that they don't have the good ideas, and that the best they can do is build a culture where those ideas are likely to filter up. I certainly believe in that concept of hiring the most creative people and making sure they have the room to experiment, the room to come up with ideas."

Along those lines, the company recently did something Elbaz describes as "very Googley" and had a hackathon where everyone competed to present a product or idea. At the end, there were 21 projects, a few of which are already in production.

Why he's coming back for another round

Elbaz didn't need to start another business after the sale of Applied Semantics, or to leave a position at Google where he was highly regarded.

But he did it for the same reason many entrepreneurs do: because he had an idea he truly believed in. It's a really big idea too. Factual's goal is to fundamentally change and improve the way data is structured in our world.

The company reflects a fascination he's had since he was a child, Elbaz told us.

"The idea started shaping before I even saw a computer in the '70s in a pretty real way. It was before I knew what a computer looked like that I got addicted to structured information," Elbaz said. "My favorite books, I remember very clearly, were 'The Guinness Book of World Records,' the 'Book of Lists,' and 'Farmers Almanac,' that had all this weather data. And then when we got cable TV I loved the ticker symbols and tracking sports."

That fascination with data led to a desire to make it as accessible as possible in a way that's standardized and simply works.

Applied Semantics was a start, Elbaz says. Factual is the continuation of that big idea.

Elbaz's goal of changing the world of data helped attract investors. They liked the size, ambition, and purity of the vision.

But investors aren't the only part of the equation. One of the biggest issues the company had was to convince other companies that they needed this kind of data.

"A lot of them don't go for vision," Elbaz said. "They go for value, for solving a pain. And we feel like we've cracked the nut now, but that took a little bit longer to turn our idea, our vision, and technology into real easy-to-integrate solutions that address what managers care about today."

Getting customers on board took a bit of a pivot for the company. When they started, the company was intended to be an aggregator of pretty much all types of data. "It turned out that that's hard to market because it's clear in your messaging that you don't specialize in any one industry," Elbaz said.

It was clear they needed to find something more specific that resonated with businesses, and prove that they could produce something incredible with that.

That's a hugely important lesson for businesses. It's hard to convince people that you can do everything well. It's even harder to do it. So Elbaz and his team chose to focus on local data, and businesses have responded. And by proving they can succeed in one area, they'll have businesses' attention when they move to the next one.

Entrepreneurs who are unwilling to change are the ones most likely to fail. That's one of the great things about a small business. You can constantly adapt and change.

Elbaz has come a long way from his first company, which he funded with his own money. "We had a culture of frugality out of necessity," he says.

Many people would have chosen to stay at a great job at Google where they were highly regarded. But there's something fundamentally appealing about working with a small group of people to make a big change.

That helped draw Elbaz back into the startup world for a second round.

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