Eric Siu breaks down why well-funded startups waste millions on ads that don't work. They chase flashy billboards and offline campaigns instead of performance marketing that actually converts. Poor messaging, weak offers, and ego spending kill ROI before the product even gets a fair shot.
Why raising too much money causes founders to burn it on silly things. So this is at the Ahrefs conference. And then this company, they hired a driving billboard basically. And on the billboard it said, try our tool, right? Use code Ahrefs for 80% off. But the ironic thing was the word Ahrefs was bigger than all the other words on that ad. And it actually drove more signups for Ahrefs because people saw the words.
In the Bay Area, you see all these people having all these billboards on the freeway to the city. And I'm like, dude, most of these billboards don't convert the way that people want and they're paying an arm and a leg. And I'm like, dude, Dude, this is just a waste of money. And he's like, no, he's like, they must be decently big if they're spending money on these billboards. I look it up, raised over half a billion dollars. I'm like, wow, some of these companies are just raised a ton of money. I'm like, no wonder they're running these useless ads. And it's just like, you're not going to get an ROI from a lot of stuff. It's not that billboard ads are a bad idea, it's the messaging that they're putting in on the billboard ads, and it's the offer are really terrible. And they're just doing these things because they have money to blow, and they should be spending it in performance areas first because that'll convert a lot higher. And I get Billboard ads and offline are versions of performance, but they're just blowing money.
