Spokeo helps people find other people. And with 18 million monthly unique visitors, the people search engine shows that keeping tabs on personal information can be a profitable business.
The Pasadena company has seen huge growth in both revenue and staff. Spokeo announced this week it hit $57 million in revenue this year, a 159 percent increase over the last three-year period. Chief Executive Harrison Tang said he thinks Spokeo can hit $100 million in annual revenue in two years.
The firm came in at No. 22 on the Los Angeles Business Journal’s 2014 list of fastest growing private companies in the county.
What began as a familiar tech origins story – eight recently graduated engineers working out of a parent’s garage – has evolved into a 160-person machine. The data aggregator, which has been profitable since 2008, is hiring. It’s currently got 50 job openings, mostly in engineering.
Tang, one of four co-founders, all of whom fill out the company’s C-suite, chatted about how the company’s fast growth is spurring new business opportunities – even with legal battles lurking in the shadow.
Spokeo’s business is in aggregating people’s information, but isn’t it easier to find people these days? How do you stay current?
The Internet is always changing so you’ve got to keep up with the times. In 2006, we started as a social network aggregator, and in 2008, we pivoted into a social search engine. In 2010, we finally created a version that’s a full-fledged people search engine that includes name search, phone lookup, address search, etc. Our next big initiative will be genealogy and enterprise.
Talk more about this new initiative.
Previously, when people talk about people search, they’re thinking about living people. But actually there’s a big opportunity to reconnect with grandparents, great grandparents, great great grandparents. We’ve aggregated about 600 million historical records dating back to 1790. We can help users find out about their family history, ancestors and genealogy. For enterprise, we’re trying to help enterprise customers do people research better. We’re one of the top tools that a lot of law firms use for people research. We want to create a custom-tailored solution for law enforcement officers, lawyers and other heavy enterprise users.
In 2012, you settled with the FTC for $800,000 on consumer protection violation charges for selling information about job applicants to employers without making sure the data was accurate. The enterprise business you talked about sounds like Spokeo’s platform could be used for employee screening.
We have explicitly stated on our website that you cannot use this for employee screening purposes. People who pay for information, they have to complete the data compliance questionnaire. If it’s for employee screening, we won’t let them use the site. Enterprise is a vague term. To clarify it a bit, risk mitigation and identity verification are the two key enterprise cases we’re focusing on. To give you a sense of how big the market is, the number one player in the risk management space generated $1.1 billion in 2013.
You also requested earlier this year a hearing with the U.S. Supreme Court to appeal the revival of a 2010 class-action lawsuit that said Spokeo violated the Fair Credit Reporting Act. The suit filed by a Virginia man alleges Spokeo showed incorrect information about him, which he claimed affected his ability to find employment. What’s the status on the case?
We’re just waiting for the Supreme Court. What we’ve done since 2010 is to make sure the data is secure, private and accurate. We’ve learned a lot through the process, and we’re very grateful for the opportunity.
So how do you ensure user privacy?
The technology we built is very powerful so we respect everyone’s privacy. We have an easy opt out option if you don’t want your information on our site. It doesn’t require any verification other than an email verification. For every single premium user, we have a data compliance insurance questionnaire to ensure people are using it for the right intents and purposes.
What other growth numbers can you share?
In 2012, we made about $22 million in revenue. This year, we made about $57 million. If we continue this growth trajectory, I think we can hit about $100 million in two years. As for staff, in 2010, we had eight people. Now, we have more than 160. In the past three years, we’ve gathered millions of paying customers. We’ve achieved quite a bit. Imagine eight of us, most of us engineers, typing on our computers. Now, we’re not just a virtual brand, but rather a brand that people know.
Staff reporter Melissah Yang can be reached at [email protected]. Follow her on Twitter @MelissahYang for the latest in L.A. tech news.
