Technology has shifted the way advertisers and ad agencies conduct business, and one L.A. company has been able to capitalize on this trend.
And while startups with meager sales can easily triple or quadruple their revenue, it’s more challenging for a company such as OpenX, with 2012 revenue of $155 million, to keep up significant growth.
The company reported growth of 574 percent from 2010 through 2012. The digital advertising technology company in Pasadena is No. 6 on the Business Journal’s list of Fastest Growing Private Companies and one of the biggest companies on the list this year.
It has more revenue than any other company in the top 10.
Tim Cadogan, chief executive of OpenX, attributes the company’s growth to the increasing shift toward automation in the buying and selling of digital advertisements.
“We didn’t know for sure, but what we were able to bet on was that this section of the advertising market would start to see a lot more automation and science applied to it,” he said. “You’re seeing more science and therefore more automation being applied to the buying and selling of advertising.”
By noticing this trend, the company developed an automated ad exchange, which allows advertisers and website publishers to purchase and sell ads in milliseconds. The company served 3 trillion ad transactions in 2012.
OpenX started in 2008 and has a staff of 300 with offices in New York, London, Munich and Tokyo. It serves some of the biggest ad buyers and major media publishers, such as United Online Inc. in Woodland Hills.
In the last year, the company moved to a 47,000-square-foot office space, opened the Tokyo and Munich offices, and expanded its management team.
And there are still empty desks at the office as the company prepares for more new hires. However, Cadogan said the next challenge is developing the team while focusing on product innovation.
“We’re blessed by being in a space that’s moving fast,” he said. “But that’s also a lot of work because we have to continue to anticipate and innovate.”
He plans on continuing to seize the opportunity for growth.
“The challenge just shifts from the early days when it’s more existential – will we make it to the end of the year?” he said. “That has gone away and now I feel almost more pressure because not that many companies get to this stage. So once you’ve got to this stage, what are you going to do next?”
– Subrina Hudson
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