20VC AppLovin’s CoFounder & CEO, Adam Foroughi on How AppLovin Might Be The Venture Capital Industry’s Biggest Miss, How To Run a 1,000+ Organisation with Very Few Meetings & Balancing the Demands of Wall St with Long Term, Sustainable Growth

Summary Notes


In this episode of 20 VC, host Harry Stebbings interviews Adam Foroughi, the energetic and charismatic co-founder and CEO of AppLovin, a company that has revolutionized the app development landscape by providing marketing, monetization, analysis, and publishing tools. Under Foroughi's direction, AppLovin has achieved an impressive scale, going public, expanding to a global team of over a thousand, and generating over a billion dollars in revenue in 2020. Foroughi's journey began in derivatives trading before founding Lifestreet Media and Social Hour, and his entrepreneurial approach has been informed by his experiences with previous startups. He emphasizes the formulaic nature of startups, the importance of recruiting passionate talent, and the advantages of risk-taking when not solely motivated by money. Foroughi also discusses the acquisition strategy at AppLovin, including the strategic purchase of Mopub from Twitter, and how a focus on partnership and trust has driven successful integrations. He shares insights on leadership, the value of fitness, and maintaining a balance between work and family life.

Summary Notes

Introduction to Episode and Guest

  • Harry Stebbings introduces Adam Foroughi as a high energy, charismatic, and fun guest.
  • Adam Foroughi is the co-founder and CEO of AppLovin.
  • Under Adam's leadership, AppLovin went public, grew to over a thousand employees, and scaled revenue to over $1 billion in 2020.
  • Adam previously founded Lifestreet Media and Social Hour, and started his career as a derivatives trader.
  • Harry thanks Akin, Leor, and John Burbank for their contributions to the episode.

"And today's guest was one of the most high energy, charismatic and fun guests I've had on the show in a long time."

This quote introduces the guest, Adam Foroughi, and sets the tone for the episode, highlighting Adam's positive attributes.

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This quote explains the services provided by Remote, one of the sponsors, emphasizing the ease of international employment through their platform.

Founding Story of AppLovin

  • Adam Foroughi discusses the founding of AppLovin, which was his fifth startup.
  • The company was founded to solve the problem of app discovery through advertising.
  • The mobile app market was already cluttered, and the need for app discovery was anticipated to grow.

"So our thesis on the company was just that app content creation was going to explode."

Adam explains the core idea behind AppLovin, anticipating the explosion of app content creation and the resulting need for effective app discovery solutions.

Serial Entrepreneurship

  • Adam believes that startups are formulaic and that previous experience is invaluable.
  • He discusses the importance of knowing how to recruit, organize, and motivate people, pivot problems to solutions, and raise money.
  • Experience helps entrepreneurs know what to do and what not to do.

"Startups are formulaic, like at every step."

Adam asserts that there is a formulaic aspect to startups, and past experiences provide a framework for future entrepreneurial endeavors.

Lessons from Previous Companies

  • Early in his career, Adam focused on making money for necessity rather than passion.
  • With AppLovin, Adam prioritized building something significant and game-changing.
  • He made strategic decisions based on risk-taking and personal enjoyment, rather than optimizing for money alone.

"I want to build something really big. I want to do something that is really game changing in whatever I'm passionate about."

This quote reflects Adam's shift in motivation from financial necessity to passion for creating something impactful and transformative.

Recruiting Talent

  • Founders need to recruit talent themselves, especially in the early stages.
  • Adam emphasizes that a founder's passion is critical in convincing talent to join.
  • The idea itself is less important than the ability to attract top talent.

"The only job early on is to surround yourself with talent, because the idea, frankly, doesn't matter."

Adam highlights the importance of recruiting talent as a primary task for founders, suggesting that the initial business idea is secondary to the team's quality.

Challenges with Early Funding

  • Adam faced difficulties raising funds from traditional VCs.
  • He attributes this to being an outsider and to VCs following market trends.
  • The rejection from VCs was ultimately beneficial, leading to bootstrapping and valuable insights.

"Like the best thing that ever happened to me was hearing, no."

Adam reflects on the positive outcome of facing rejection from VCs, which led to a more independent and insightful path for AppLovin.

Strategic Direction and Transition

  • AppLovin transitioned from an ad network to a content creation platform.
  • Adam sought to create value through performance-based advertising and avoid the negative perception of ad networks.
  • The company acquired first-party data to improve ad targeting and moved into gaming to facilitate this.

"Let's go get first party data that we can then build algorithms on top of and understand our user better."

Adam explains the strategic decision to acquire first-party data to enhance AppLovin's advertising performance and user understanding.

Internal Transition and Execution

  • AppLovin's internal transition was executed quickly and without overthinking.
  • The company did not hold extensive meetings or debates; they acted on decisions promptly.
  • This approach allowed for rapid movement and avoided unnecessary deliberation.

"It wasn't as much about like, let's go convince people internally, let's rally everyone. It was just do it."

Adam describes AppLovin's straightforward and action-oriented approach to internal changes, emphasizing the lack of extensive internal convincing or rallying.

Decision-Making Process

  • Adam Foroughi discusses his approach to decision-making, emphasizing speed and frequency over prolonged strategizing.
  • He makes many decisions daily, most of which are not strategic.
  • Adam believes that overanalyzing decisions can slow down progress.
  • By quickly moving through decisions, he increases the probability of success.
  • The focus is on the successful outcomes, not on the ones that didn't work out.

"I make ten decisions a day, and most of them aren't strategic. Maybe every quarter I make one strategic decision. But if you plan, if you process, if you over communicate, you start overanalyzing and slow down."

The quote explains Adam's high-frequency decision-making approach, where he avoids getting bogged down by over-planning and instead focuses on execution.

Meeting Culture and Communication

  • Adam Foroughi describes a company culture with minimal meetings, relying heavily on asynchronous communication tools like Slack.
  • Meetings must have a clear agenda and purpose; otherwise, issues should be resolved through chat.
  • This approach saves time and increases efficiency by avoiding the time loss associated with conventional meetings.

"One slack as an efficiency tool has been just insanely popular for our company... And as you put it into asynchronous chat and real time dialogue, you start not needing meeting."

Adam explains how the use of Slack has reduced the need for meetings, allowing for more efficient and direct communication within his company.

Team Empowerment and Accountability

  • Hiring entrepreneurial individuals who are willing to take risks without fear of loss is key to Adam's team-building strategy.
  • He encourages ownership and accountability, allowing team members to make decisions and learn from them.
  • The goal is to develop a team that takes pride in their work due to the autonomy they are given.

"If you allow them to take ownership responsibility and take action without fear of downside, that team develops to have more responsibility, more ownership and more pride in what they're doing because they have the ability to take those shots and learn from them."

Adam emphasizes the importance of empowering team members to make decisions and take ownership of their work, which leads to personal and professional growth.

Identifying Entrepreneurial Candidates

  • Adam Foroughi looks for candidates who are driven, not entitled, and willing to hustle.
  • He values individuals with a strong personal drive and the intelligence to learn and take chances.
  • Early on, he preferred candidates with something to prove over those with impeccable academic records but less hunger for success.

"I think the key for us, or for me at least early on, was finding people that weren't entitled coming in and had a reason to push themselves."

Adam discusses his criteria for hiring candidates, focusing on their drive and determination rather than just their educational background or credentials.

Evolution of Leadership

  • Adam Foroughi reflects on his growth as a leader, evolving from an introverted individual to a confident CEO.
  • His confidence in his abilities and the business has been constant, although his communication skills have improved over time.
  • Adam's leadership style has been shaped by his commitment to hard work and his vision for the company.

"I definitely wasn't that early on, but I was always confident in my own abilities, and I was always confident about what we were building."

This quote illustrates Adam's journey from a self-doubting individual to a confident leader, highlighting the importance of self-belief and vision in leadership.

Transition to Public Market CEO

  • Adam Foroughi found the transition to being a public market CEO smoother than expected.
  • He emphasizes long-term thinking over short-term market pressures.
  • Adam focuses on building a big business over time, rather than optimizing for short-term investor returns.
  • He seeks investors who align with his vision and execution capabilities.

"I'm not in it to optimize for a couple of months out, six months out, nine months out. I'm in it to build a big business for many years to come because I'm in it to go have fun for really the rest of my career, as long as I'm competent enough to hold this position."

Adam shares his perspective on being a public CEO, focusing on long-term goals and building a sustainable business rather than succumbing to the short-term demands of the market.

Execution and Delegation

  • Adam Foroughi discusses the balance between delegation and control.
  • He aims to mentor team members to excel in specific areas and trusts them to take ownership.
  • Effective delegation has been crucial for scaling the business.
  • Adam prefers to work closely with those he believes can handle responsibility and grow within the company.

"And so what I found is what works for me is probably different than other folks, and it's different for every single leader of an organization or of a business unit or team."

The quote highlights Adam's personalized approach to delegation and leadership, tailored to his unique management style and the needs of his company.

Addressing Performance Issues

  • Adam Foroughi is aggressive with those he respects most to foster their development.
  • He uses pressure as a tool to teach and build close relationships with his team members.
  • The approach to addressing performance issues is not formulaic but varies based on the individual and situation.

"The more respectful and quiet I am towards someone, the less I believe that I can hand something off to them."

Adam describes his method of handling performance issues, indicating that his level of engagement with an individual reflects his belief in their potential and ability to take on responsibility.

Trust and Working Relationships

  • Trust is crucial in working relationships, especially when working closely together.
  • Trust is not just about honesty but also about belief in someone's capacity to excel in their specific role.
  • Trust is essential for a successful partnership, and without it, it's necessary to move on.

"Like, at that moment, I know I'm not going to be able to get this person to a point of full trust. Therefore, I got to move on."

This quote emphasizes the importance of trust in working relationships and the need to move on when trust cannot be fully established.

"It's belief in their capacity to become you at that sliver of the world."

Adam Foroughi explains that trust is about believing in someone's ability to perform at a high level in their specific area of expertise.

Success and Passion

  • Success is not solely dependent on intelligence or qualifications.
  • Passion, the desire to outwork others, and the ability to solve complex problems are key to success.
  • Assessing these qualities in individuals takes time and cannot be determined solely through interviews or short-term interactions.

"What creates that success is a passion and a desire to outwork everyone around you and understand and solve puzzles mentally that other people can't solve."

Adam Foroughi discusses that success is driven by passion and the relentless pursuit of solutions, rather than just raw intelligence.

Acquisitions and Strategic Partnerships

  • Acquisitions were a strategic move to gather data, especially from gaming companies.
  • The market for gaming acquisitions was not as competitive in 2018, resulting in lower multiples.
  • Partnerships were based on trust and mutual goals, not just financial transactions.

"We wanted to partner with people we like working with."

Adam Foroughi highlights the importance of partnerships being more than transactions, focusing on relationships and trust.

"We didn't go to banker run processes, we didn't go bid into competitive moments in time where you're just thinking about dollars."

This quote illustrates the unique approach to acquisitions, which prioritized relationships over competitive bidding processes.

Integration and Company Culture

  • Integration challenges are common in acquisitions, but were avoided by allowing acquired companies to retain their creative processes.
  • Trust and cultural alignment between the companies are crucial for a successful acquisition without integration.
  • The goal was to collaborate with companies that could operate independently and align with the parent company's culture and standards.

"You have to trust that they can do it and do it at the standard that you like to operate and that the cultural beliefs align with what you believe as a parent holdings company."

Adam Foroughi explains the necessity of trust and cultural compatibility when acquiring companies that will operate independently.

Current Acquisition Strategy

  • The acquisition strategy has changed due to achieving the initial goal of gathering data and reaching a critical mass.
  • The focus has shifted from acquiring new companies to leveraging the acquired data and technology for growth.
  • The company has become less active in acquisitions and is concentrating on expanding its software stack.

"We've got 3000 game developers that are building games for us. We've got almost 20 studios around the world."

Adam Foroughi outlines the scale of the company's development resources, indicating a shift from acquisition to internal growth.

Lessons from Acquisitions

  • Not all investments will be successful, and there's a learning curve in choosing the right partners.
  • Smaller companies may struggle without the necessary support, which was a lesson learned from past acquisitions.
  • The ideal partners are those who are self-sufficient and align with the company's operational model.

"The ones that we've, I think, struggled with are the smaller ones because they do need more help."

Adam Foroughi shares insights on the challenges faced with smaller acquisitions and the importance of self-sufficiency in partners.

Mopub Acquisition

  • The acquisition of Mopub was driven by strategic considerations to improve the mobile advertising ecosystem.
  • The goal was to create a unified platform that would benefit the market and provide more efficient solutions for publishers.
  • The acquisition was based on a mutual understanding of the potential for greater market impact under new ownership.

"It really was us deciding, look, this is what's best for the market."

Adam Foroughi discusses the rationale behind acquiring Mopub, focusing on the broader benefits for the market rather than just financial gain.

Integration of Acquired Assets

  • The integration of Mopub into the existing Max platform is ongoing, with the aim of creating a seamless transition for publishers.
  • The unified platform is expected to clear a significant amount of ad spend, making it a major player in the digital advertising space.
  • The integration process is focused on providing benefits to all stakeholders in the ecosystem.

"By the time we're done with this next year, clearing over $15 billion of ad spend in our marketplace, that's a huge amount."

Adam Foroughi highlights the expected scale of the integrated advertising platform post-Mopub acquisition.

Marketplace Momentum

  • The marketplace is experiencing buy-in from various stakeholders.
  • Developers and demand side are contributing to the creation of something impactful.
  • Optimism about the potential of the current business environment.

"And I think we now have a chance with the marketplace buying in, all the developers in the ecosystem and the demand side, to create something that's great."

This quote expresses enthusiasm about the collaborative potential of the marketplace, developers, and demand side to create significant value or products.

Competitive Landscape Respect and Admiration

  • Acknowledgment of the achievements of large, established companies.
  • Google and Facebook are admired for their sophisticated advertising technologies.
  • The evolution of advertising over the past 15 years has been impressive, moving from spam to relevance.
  • The speaker expresses a personal connection to the industry and the advancements made by these companies.

"Google and Facebook are the two most sophisticated advertising companies on earth. They've built technologies that when I started my career and 15 years ago on browser, we saw the ads that were running. I mean, frankly, they were just spam compared to what it is now. It's so relevant."

The quote highlights the speaker's respect for Google and Facebook's technological advancements in advertising, which have significantly improved since the speaker began their career.

Personal Reading Habits and Book Recommendations

  • Speaker B admits to not reading much despite a resolution to read more.
  • Mentions "Never Split the Difference," a negotiation book, as interesting.
  • Discusses the challenge of implementing negotiation tactics from the book.

"But that was 'Never Split the Difference,' which was negotiation book. And I found it to be pretty interesting."

This quote shares a personal anecdote about reading preferences, specifically mentioning one book that stood out to the speaker.

Challenges of Managing a Growing Company

  • The growth of the company has led to an ever-increasing workload.
  • There is a feeling of never being able to catch up, leading to stress and less sleep.
  • The speaker is seeking ways to manage the responsibilities that come with the company's expansion.

"It's almost like there was a time I could just get through my day, feel good, get a good night's sleep, and just know that I got through the task list and tomorrow I'd get through the task list and it'd be that now it continues to build to a point where I can never catch up."

The quote conveys the speaker's experience of the increasing challenges associated with managing a growing company and the impact on personal well-being.

Exercise and Work-Life Balance

  • Speaker B tries to run and lift weights regularly to manage stress.
  • Exercise is seen as essential for handling the pressures of work.
  • Incorporates physical activity into the workday, such as walking meetings or running with his wife.

"And what I've found is in order to absorb the pressure and the workload, I have to do something active."

This quote emphasizes the importance of physical activity as a means to cope with work-related stress.

Family and Work-Life Balance

  • Speaker B credits his wife for managing the family, allowing him to focus on work.
  • Acknowledges the difficulty of balancing work and family life, especially with five children.

"That's all credit to my wife. If I had to do five kids of balance work life, I'd be done."

This quote recognizes the speaker's spouse's role in maintaining the family's well-being, which supports the speaker's work focus.

Personal Billboard Message

  • Speaker B would encourage people to find and chase their passion.
  • Believes that passion leads to professional happiness and fulfillment.
  • Reflects on his own experience of finding passion in an unexpected field.

"And I think I just say, go find your passion, chase it."

The quote suggests that pursuing one's passion is a pathway to happiness and success, which is a personal belief of the speaker.

Mentorship and Learning

  • Speaker B values learning from a wide range of people and experiences.
  • Does not have a single mentor but learns from many smart individuals encountered.
  • Close relationships, such as with a spouse or business partners, provide valuable learning opportunities.

"And so what I've found is, I guess I get mentored by my experiences, my relationships, the people I cross with, then I'm learning off the sum total of all of that."

The quote reflects the speaker's belief that mentorship can come from a variety of sources and experiences, rather than a single individual.

Leadership Style and Aspirations

  • Speaker B wishes to improve his ability to mentor others within the organization.
  • Aspires to move from being in the weeds to teaching and developing talent.
  • Recognizes the greater impact of teaching and coaching over individual task completion.

"I would love if I wasn't in the weeds, and I just trusted everything to the folks around me, and I could go up a level and say, my job is to teach."

This quote reveals the speaker's desire to transition from hands-on tasks to a more strategic role focused on mentorship and talent development.

Future Outlook for Applevin

  • Speaker B is committed to innovation and pushing the envelope.
  • Anticipates that Applevin will continue to make bold decisions to drive market acceleration.
  • Looks forward to discussing the company's evolution and innovative turns in the future.

"And so we will continue to do that. And hopefully, in three to five years, we're talking about some fun turns and twists in the business evolution that we've had over here."

The quote indicates a forward-thinking approach to business, with a focus on innovation and a willingness to take risks for growth and development.

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