In 2007, when we founded AdRoll with the mission to make display advertising work for everyone, our work was cut out for us. At the time, the banner ad world consisted of the biggest name brands (think Doritos) running ineffective ads on premium sites at really high prices, and direct response companies (think teeth whitening) carpet-bombing annoyings ads across the leftover inventory. It wasn’t a pretty world. The targeting was crude and the good people of the web started developing banner blindness. And for the millions of brands that had enjoyed success on SEM platforms like AdWords, there was no way to make display advertising work.
But we plugged away on our ideas, determined to reinvent the display world. Working out of the back closet of another startup, we brought our early vision to market and in 2008 raised our first major round of funding from an all-star set of investors. However, the party didn’t last long. Not long after we closed our round, Lehman Brothers crashed, then Bear Stearns, then the whole market pancaked, which essentially evaporated all non-essential advertising budgets.
What was a terrifying climate at first, became a blessing in disguise for us. We were forced to get very close to the few advertisers that stuck with us. We asked them “In this economy, what would you possibly spend advertiser dollars on?” The answer was always ROI: “I want every dollar I spend on ads to bring me more than a dollar in sales.”
At the time, positive ROI was something relatively unheard of in display, unless you sold the aforementioned teeth whitening creme, home mortgages or diet pills. There had to be a better solution for legitimate brands. Lucky for us (and our early customers), 2008 also coincided with the rise of the advertising exchanges, which fascinated us. We could suddenly plug into a huge set of advertising inventory and target users in new, interesting ways. It may be hard to remember, but in 2008 retargeting wasn’t a well-known concept. Only the largest brands and agencies were dabbling in it. We weren’t sure if smaller advertisers would grasp the concept, but we tried it out, and the results were immediate. Not only did they understand it, our small set of advertisers were driving conversions within minutes. At that point, we knew we had a killer app on our hands and we committed AdRoll to building the first retargeting platform for brands of all sizes.
Fast forward to today, AdRoll now has more active retargeting (or for that matter, real-time advertising) clients than any other platform. We work with over 5,000 enterprise, mid-sized and small advertisers and we’re adding more than 500 per month. Word of mouth is strong–we get more business inbound than through reach-outs. Our customers love us because we offer great service on top of a platform in which we’ve heavily invested in UX, automation, reach, and optimization. This efficient model helps us run retargeting campaigns more profitably than anybody else.
And, born out of our bad economy roots, we’ve done it all with phenomenal capital efficiency.
That’s why I am so excited to announce today that AdRoll has raised $15 million in new funding. If we’ve been able to accomplish so much with relatively little, imagine how we will blow the doors off with considerable resources. This is a big step up in resources for the team and will bring us closer to truly changing the game of data and display. That said, the title of this post is tongue-in-cheek. We know no other way than our “make every dollar count” approach to building a fantastic organization.
The new round is led by Foundation Capital and joined by our previous partners at Merus Capital and Accel Partners. Charles Moldow, general partner at Foundation, will join our board. Our team quickly developed a fantastic rapport with Charles. Even before we closed, we were making healthy use of his deep operational and entrepreneurial experience. Welcome to the team, Charles!
The new funds will be invested heavily into our platform, data infrastructure and team. In the coming months, you can expect more super-friendly solutions to challenging real-time advertising problems. We’ve learned that our advertisers are sitting on top of their very own gold mines of first party intent data. To this end, you’ll see us further exploring new ways to close the loop of “collect data, analyze data and act on data.” We’ll also be rolling out new high performance products in mobile, video and social.
Naturally we’ll also be adding new Rollers. First, we’ll see new recruits in our San Francisco headquarters (affectionately known as ShangRolla) as we expand into a second floor of our building, doubling our space to 24,000 square feet. Soon after, we’ll be opening new domestic and international offices. We’re looking for uber-smart, hard-working and fun people in a variety of roles (see our jobs page.)
Thanks again for all your support of the mission. Now back to making advertising better…
– Aaron Bell