Episode 6: From Consumer App to Location Data company with Josh Anton, CSO of DigitalEnvoy

Welcome to the Location Insights Podcast.
Guest: Josh Anton (Chief Strategy Officer, DigitalEnvoy)
Host: Kevin (Global Marketing Manager, unerry Inc.)

DigitalEnvoy: https://www.digitalenvoy.com
Outlogic: https://outlogic.io

Have feedback or like to be a guest on the show drop us a mail: [e-mail] 

In this episode I speak with Josh Anton about his entrepreneurial career and experience growing a startup, to extreme business challenges, leading sale of his company.

• An accidental start in location data: A college safety app called Drunk Mode grew to nearly two million users and unexpectedly launched Josh Anton’s career in location data.
• A failed SDK partnership sparked a new company: Poor experience as a client pushed the team to build its own location technology, laying the groundwork for X-Mode.
• Publishers powered the growth: X-Mode scaled by giving app developers a stronger way to monetize their apps without compromising technical performance.
• Hypergrowth came with hard lessons: Expanding from a small startup to more than 50 employees exposed the need for experienced leaders, tighter processes, and faster decision-making.
• The company nearly collapsed overnight: Platform restrictions, public controversy, lost investment, and mounting financial pressure put X-Mode’s future at risk.
• Relationships became the lifeline: Loyal employees, committed publishers, and a resilient technical team helped preserve the business through its toughest period.
• Digital Envoy becomes parent company: The acquisition gave X-Mode’s technology, team, and publisher network a path forward within a broader data-intelligence company.
• Privacy is reshaping the industry: Josh sees the future in explicit consent, first-party relationships, stronger regulation, and analytics that avoid moving precise location data.

Have questions or like to be a guest on the show? Drop us a mail: [e-mail] 

Creators and Guests

Host

Kevin

Global Marketing Manager at unerry

Guest

Josh

Is the Chief Strategy Officer (CSO) at Digital Envoy (Growth / Corp Strategy / M&A)

What is Location Insights?

Welcome to the Location Insights Podcast
Where we bring you information, news, and insights from Partners, Clients, and Data Scientists about: Location marketing, Retail Media, POI, Data Analysis, and other interesting topics.

Hi, and welcome to the Location Insights podcast.

I am your host, Kevin, the Global Marketing Manager at unerry Inc.

unerry is a location analytics platform and data insights company based in Tokyo, Japan.

In today's episode, we'll be covering some interesting topics, including starting up a location marketing company to growth of that company, to acquisition of that company.

And with me on that conversation today is Josh Anton.

He's currently the Chief Strategy Officer at Digital Envoy.

Welcome to the show.

Thank you for joining us.

Thank you for having me, Kevin.

I'm excited to be here.

So, why don't we

Just kind of jump in looking back at how you got into the location marketing industry.

Story.

What got you interested in location marketing?

Where do you study in school?

What was your background?

You can talk a bit on that.

Yeah, I would probably say I accidentally fell into location marketing.

So a little bit about myself.

I went to the University of Virginia near the DC area, about two hours south of DC.

And I graduated with a bachelor's in commerce and I had track in IT and marketing 11 years ago at this point.

But when I was in college, right, I wanted to build an app.

And basically, a girl drunk dialed with me at a college party, and the rest was history.

And so we ended up building an app called Drunk Mode.

So I actually started in the consumer industry or as an app publisher.

And so we, God, we grew that app to about 2 million folks at its peak.

Basically, a lot of college students across the US, the UK, and Canada.

And what the app did was it stopped you from drunk dialing your friends.

I allowed you to find your drunk friends so you didn't lose them, and it showed you where you went last night.

So, this was built in 2013, and we ran that for a few years post-graduating college in 2014.

And essentially in 2016, this was kind of the early stages of the location industry, back in a day when Placed was a separate company, you know, prior to getting acquired by Snapchat, then to Foursquare and where they are today.

And so we had a few companies approach us and say, hey, we want to integrate our SDK into your app.

We'll pay you for your location data.

And so there was one company in particular that is called Hardcore Method.

And this company we integrated in 2016, they drained a third of our battery life a day and never paid us.

But it was probably one of the best lessons we learned.

Where essentially we lost a lot of our user base because of it.

This wasn't the heyday.

Basically, iPhone 4.

When SDKs, when you're integrated, it drives a ton of battery life and so forth.

And so one of my engineers, Gabriel Jensen, who's still with us today at Digital Envoy, was like, you know what?

Why don't we just take this thing out?

Let's just put Apple's SDK for location management basically on full drive and see what happens.

And it was taking up maybe 20% battery life.

So we had to grow to 2 million folks.

We had about 100 college reps across the U.

S.

in rural areas and cities.

And we just essentially had them test their SDK across the board.

We basically built out an SDK.

During that time, we got into AOL's incubator, and I met another one of my teammates.

I believe you know, Donnie Yancey.

He was just about to move to San Diego.

And when he saw our company in Incubator, and he was the former CEO of MapQuest, so he had built the early stage of location for them.

He was like, Josh, stop focusing on drunk mode.

You should go out and you should contact all of your app friends since you know a ton of apps in the industry, build out an SDK and integrate it into their apps.

And so, myself, Jamie, and a few others, Jamie was my COL, we did an entire retrospective, looked up 500 companies.

It was a very crowded industry back in the day: beacon companies, location companies, location tech.

And we were like,

There's a ton of location companies that are licensing data.

But we also realize there's probably only about two to four thousand apps that have above two thousand DAUs that run location.

So it seemed like everyone was selling data to themselves.

So when we entered as X mode in 2017, kind of accidental things, we needed to make money as an app.

We met the right people at the right time.

We were in AOL's incubator.

We were like, we're going to go up to all of the apps that we know, and we're going to have them sign basically two to three exclusivity as part of our business model.

We're going to pay them a fixed fee that was very high, where we can make up a 10% to 30% of their top line revenue, what we called a living wage for location data.

And we're going to help them grow.

And that was the start of X mode.

And it grew very quickly.

It went from so

We had raised about $1.

5 million at the time.

We were making $5,000 a month, and I was barely.

And it wasn't for ads.

It was some random things.

We were selling like wine racks and stuff like that.

So 2016, we made about 60K.

2017, we pivoted April 1st, 2017.

Made a million that year.

2018, 3.

6, 2019, 6.

7.

And 2020, in the height of COVID, we basically made about 1314 that year and exited at a 1.

25 million a month exit rate, so about 15.

So it was, and we went from seven people in AOL's incubator, most of us in our 20s, to about 55 people at our peak.

So it was a crazy

Incredible journey with its ups and downs.

Some things we did really well, some things that we ran into hitches along the way.

We accidentally found the location data industry.

This was not what I expected to be working on after college.

I thought we would build drunk mode out and sell it to Heineken, honestly.

So that was the initial goal that we went down a very different journey.

Yeah, that's a wild ride.

So drunkmode, to kind of recap, it was a lot of safety features.

You're going out.

Maybe you have a bit too much to drink.

You have an app that

Shares your location with your trusted friends or a couple of trusted contacts in case anything bad happens, they know where you were or where you are to get in touch.

Yep, mostly a lot of sororities and fraternities I used it actually, which we just found fascinating.

And so they would look at it to make sure their friends got home okay, essentially.

Right.

And then you pivoted to providing an SDK and acquiring first party data from other apps, location data, and that became your core business.

And then you grew that through your strategic approach was outbid, outpay the other competitors of the market at the time.

And then you would become the sole owner or the sole rights of having that data because you have that exclusivity with those apps.

That is correct.

Yeah.

And I think the things, the small things that I think made us great, I would say that having a really incredible CS process for managing the publishers

really ensuring our SDK was battle tested as well.

I like to joke that XMode and even OutLogic today is not really a data science company or data analyst company, but at our core, we're really good at data engineering and good at iOS and Android development.

And I think that helped as well with just retaining publishers.

And I think the last piece, and when we met back in the day, it's like meeting all of our publishers and building good relationships with them.

Because when it's good, it's great.

But when the going gets tough, those unique relationships breaking bread of the publisher, as I would say, really helps ensure that we still retain the people that we work with.

Yeah, definitely.

It's those connections you make with your clients, with your partners that really help you along the way.

Especially in those challenging points where things outside of your control may affect your business in negative ways.

And then you having that trust from your partners for the long term or at least for longer term into the future helps to keep those connections and those business alliances going.

And so through the very fast growth process, what was your experience like?

Are there any insights that you can share from

going from like a one, two, three person company to a fifty plus person company and leading in the location marketing industry in the States.

Yeah, I mean, I'll say this very bluntly.

I didn't know what I was doing 90% of the time.

It was my first time in my late 20s, and I would say that for probably a large amount of our team.

But where we made up with lack of experience, we made it up in innovation and hustle.

There are some things that we did really well and some things that looking back, I think we could have done

Better.

Things we did really well.

I would say that we were pioneers in trying to build a business that wasn't just focused on ad tech and data licensing there.

By really pioneering use cases and working of companies outside AdTech and GovTech and FinTech and Cyber.

That was one

Two, we had an incredible team, and we got very fortunate with many of the engineers that we brought on sales as well.

It took us a little bit to find a really good CTO, and we

Being a young team, I'm going to make the joke adults in the room, but getting I think some of the best hires we made that really matured us was like Mike Colton, who was our CFO.

Who really got us to a point that we can predict when we're going to miss or beat our revenues each month?

The typical startup part of that, working with origin and

really nailing down our sales process for CS, what an MQL and SQL is, which for any startup person with SaaS gets it.

For everyone else, it's Greek.

So, those were things we did well.

I think that because we grew really quickly, some of the processes that we had could have been a little more improved because we went from

basically in three years, five to ten folks to 50 something and 60,000 in revenue to almost to 15.

And so there were growing pains that we had that I think we could have invested a little bit more.

I think we could have fired earlier and hired faster, as other examples.

But I think

for the circumstances that we had.

And honestly, being a very new industry, we did the best we could.

And I think the results for the most part showed for it.

And we had an incredible culture.

I think that we really focused on not only the culture, but how to make location interesting.

That may have bit us in the butt towards the end of that story, but Jake was.

Incredible at getting us out front and really branding us, our former CMO, as the leader in location.

In COVID, we were out front going viral with ironically spring breakers and

Where they were going in COVID.

We were on the front page, we were on CNN, we were on the Wall Street Journal front page, all through basically figuring out how to make

location analytics interesting and useful and relevant in the moment.

And I think we did a really good job on that.

I think we tried to be extremely transparent.

I would argue all the press that we ended up having towards the end maybe wasn't the best thing because it put a target on our back.

But I don't regret.

trying to at least follow our moral high ground and try to trying to be the leader in location and pushing the envelope.

I like the joke that we were the Napster of the location industry in some ways.

Where we pioneered many of the stuff that happened.

And obviously, we got bit in the butt from it a little bit.

Yeah, I think that's a good analogy, the Napster analogy there.

Early to the market.

A huge growth, and then, let's say, legal challenges or challenges outside of your control.

I think that transitions us into what ended up

happening with the company in terms of the acquisition and the sale of your company.

So can you share any insights in terms of what that process was like and that experience?

You're at Digital Envoy today, and they are your parent company.

And how was that for you?

And what can you share on that?

Yeah, so

I will say, as someone who was kicked out as a senior in high school, I would have said, that was kicked out of my house as a senior in high school.

That would have been the worst part of my life.

This moment probably trumps that, actually.

So, some context, and you can research this online.

So we worked with an app called Bits Media.

That was the publisher name that people knew internally, but they owned an app called Muslim Pro.

And I think at the time, there were other players in the data industry that also worked with this app.

And we had basically signed our contract, started working with them in mid October.

So we had raised about $23 million at this time.

We had grown tremendously in that year.

It was a good time to raise money.

We had our series B on the table, which

It would have been nice, an 88 million pre, 100 million post Series B.

And they had signed that term sheet on November 18th.

So timeline in this.

Muslim Pro Bits Media, we ended up going live with them basically mid October of 2020.

Vice article comes out November 10th or somewhere in that second week of 2020.

We sign our term sheet November 18th, 2020 to close December 18th, 2020.

And at the time, no one was really like, all right, it's Vice, right?

You know, it's different than if the Wall Street Journal is publishing something or New York Times.

And Wall Street Journal publishes an article December 10th, 2020.

I remember this day.

Impressive, we got on the front page three times in our history: drunk mode, x-mode in COVID, and this one.

And Xmode is banned from the Apple and Google store.

Now, some background on why this occurred.

There was a little bit of politics that was going on.

There was a senator that didn't like that we were selling data into GovTech.

Particular US and EU data, or US data in this case, actually.

And they didn't like that.

And so they wanted us not to do that.

There was no law to say that we shouldn't.

It wasn't our primary business either.

It was mostly a global feed.

So, they decided to make an example out of us.

We had worked with muslimPro for about a month and a half.

PR moment happens

Banned from App Store, Series B falls apart December, basically right after the article comes out.

We've got a month of runway in the bank, and we've got to figure out how we're going to basically what we're going to do.

I took a week off that Christmas holiday, which is crazy to say with everything burning down.

I was like, I need a week to just kind of, I haven't taken a week off since I started a company, just figure out what we're going to do.

I called a bunch of different industry veterans.

And we got a term sheet from a player in the space for a million dollars for the company, which was a little ridiculous, but at least it gave me the ability to go to my board and say, hey.

We're going to go and we're going to put the company to market.

And our investor base was pretty divided.

We had about 150 investors.

A third of them wanted us to go and sue people, which is not wise.

Another third of us wanted to continue, right, and go crazy with this, right?

I feel like if we had gone that route, we would have had a down round.

And the other third were sensible of like, hey, we need, well, there were more panic, we need to get our money out now, right?

And so my board stepped off actually December 31st because we lost our D&O insurance at the time.

Basically, we had our SDK banned, so we're trying to figure out what we're going to do.

We ended up building a different type of solution to get back in the app store.

We ended up shutting off our US and EU GovTech business.

To make nice-nice with everyone.

And we ended up kicking off a process.

And so we were lucky.

The folks who led our acquisition process was an investment bank by the name of Eminence Capital.

They handled the Weatherbug acquisition.

Actually, which was also a little hairy with semantic.

So, January 6th, I basically go to all of my employees and I say, hey.

We're going to be putting the company to market.

This was the day, the afternoon or evening after we had laid off about a third of the workforce to kind of conserve burn.

One of the hardest things I had to do.

My brother was part of that process being let go as well.

So it was very like.

People we kept were the people we needed to get to the acquisition process.

When I said, hey, we've got a month of runway in the bank.

We're going to put the company up for sale.

We will also look at other investment options too.

But if you stay with us, and this company sells for above $25 a million equity in cash, we will guarantee four and a half months of pay for every employee, 18 months acceleration of stock.

And an extra three months if someone is laid off in the first 12 months post-acquisition.

And my bet, because honestly, this should have been a fire sale, right, of the company.

My bet was that

If the employees stayed, we had a chance to build a technology to get back in the App Store and clean up all the other stuff.

The team is what made XMode great.

The technology is what made XMode great.

And the published relationships made XMode great.

And those three things, if we keep those, we'll keep our clients and we'll be able to softland the company.

We only had one person leave.

All 34 other people stayed, which did not know how that hour call was going to go.

And we kicked off the process.

I had to figure out how to extend runway, so I convinced a client at the time who was paying us $300,000 a year for US data in the fintech space.