“It’s a once in a lifetime opportunity to disrupt the global mobile advertising and mobile commerce market, and we will make it happen,” says the ambitious young CEO of InMobi Naveen Tewari. Tewari symbolises the relentless energy of a hungry new generation of Indian entrepreneurs who are designing their own game instead of playing by the rules.
With more than a thousand large enterprise customers, including Unilever and Samsung, the company churned out an annual revenue of $500 million in 2013 and is looking to hit the billion dollar mark by 2016. These credentials make it a worthy partner for big players like Google and Yahoo (more so for Yahoo which does not own an AdMob kind of platform like Google). But the company is not looking to sell-out.
We are excited about the opportunities and the yet untapped potential in the mobile advertising market. Wait and watch out for some of the truly disruptive products coming out in the next few weeks from our end, says Naveen.
To put matters into perspective, last year Facebook had proposed to buy Silicon Valley-based SnapChat for a whopping $3 billion. But Evan Spiegel, CEO and Co-founder of SnapChat, had similar bigger plans. The company has raised around $648 million across six rounds in three years, and has acquired three companies in 2014, just months after declining the sweet deal. In 2013, Snapchat was a revenue less company and was valued at $10 billion, and was soon going to start making big money from advertising. Spiegel, in an interview with ‘Vanity Fair’, said the ads will be around the company’s ‘stories’ product, and will be optional to view. “We’re cutting through the new technology around ads to the core of it, which is telling a story.”
This comparison is a shot in the arm for the fledging Indian startup system, which is increasingly drawing the attention of global investors.
Mohandas Pai, a long known champion of the Indian startup ecosystem, feels InMobi's decision to stay independent and not sell out is testimony to the grit and integrity of the company. He told YourStory,
In order to become a globally dominant company, InMobi needs to stay independent. When InMobi gets listed on the BSE, it will be an immense moment of reckoning for all the other Indian startups out there daring to dream big.
It is encouraging to learn that the subject of Indian startups is of keen interest in global boardrooms. With increased Internet access in the emerging markets, the valuations of the Indian dotcoms have gone up. InMobi is definitely one of the largest and most successful independent mobile advertising networks. I am proud to see an Indian brand like InMobi having global footprints.
Founded in 2007, InMobi was originally a text message-based advertising company. It shifted to mobile advertising in early 2012. Its products gained national and international traction and attracted multiple rounds of funding, totalling to about $220 million. It is one of the few Indian companies which have gone global. Ironically, all of InMobi’s investors, except Mumbai Angels, are foreign investors – SoftBank Capital, Kleiner Perkins Caufield and Byers, and Sherpalo Ventures.
Since then the company has set aside finances and made a series of investments—including the acquisition of two San Francisco-based companies - MMTG Labs Inc., a startup that operates an app marketplace for Facebook pages, and Sprout, an HTML5 ad builder—toward building its forte in the sector.
Ravi Gururaj, Nasscom Executive Council Member and investor, told YourStory,
I actually would not be disappointed if the Google deal does not materialise. I expect the InMobi leadership to solidify their global leadership in digital advertising and take their company to a blockbuster IPO. That would provide a huge fillip to our Indian ecosystem.
Sharad Sharma, another entrepreneurial veteran, told YourStory,
We are still in the early days of the global smartphone revolution and I expect InMobi to emerge as a global category leader in the mobile first customer engagement platform segment of the market.
InMobi recently announced the creation of $25 million fund for independent game developers, who can create disruptive technology in the ads space. Over the last two years, the company also launched various products in the ads space to up its game. This includes the launch of an interactive video ads platform, which helps build mobile advertisements that are intelligent in nature, appographic targeting ads, which will help advertisers and marketers increase the downloads of their mobile apps, and its new ‘Monetization Solution for Games’, which is the industry-first playable ads format. But their best is yet to come, insists the InMobi team.
According to a report by research firm Gartner Inc., global mobile ad revenues, which were $11.4 billion by the end of 2013, would continue to grow five-fold by 2016.
However, the ad tech industry itself is undergoing a broad change that even InMobi's very unique acquisitions signify. Google has missed its quarterly earnings target, amidst rising complaints of publishers that the revenues have been dropping steadily across the board. Facebook is eating up the global small business ad spend that would have otherwise gone to Google by sheer virtue of increasing the amount of time spent on the platform especially on mobile. This is going to get worse as Pinterest has also opened up its ad platform with advertisers already queuing up to access the highly valuable female audience on this social platform. With this rise in social advertising and the growth of native advertising led by Buzzfeed and other new media outlets, ad technology as we know it is set to change drastically.
"InMobi is one of the very few scaled-up B2B focused technology companies out of India with a global reach and customer base. The scale at which they operate typically enables management to pursue various growth strategies at any given point in time,”says Klaas Oskam, Managing Director of Signal Hill India, in an interaction with YourStory.
These certainly are interesting times. It remains to be seen whether the pursuit of grander goals instead of selling out was a smart move. In any case, this marks a new innings in the startup eco-system of India, where companies like InMobi are hungry to chase bigger ambitions and not settle for anything less than creating a new global benchmark.