Monday, July 8, 2013
Building A Dream Team For Mobile Advertising, with Gradient X
Story by Benjamin F. Kuo
If there were such a thing as a "Dream Team" for mobile advertising, you would be hard pressed not to pick the founding team of Los Angeles-based Gradient X (www.gradientx.com), whose founders include Michael Lum (formerly of OpenX), Brian Baumgart (formerly at Adconion), and Julie Mattern (formerly of Rubicon Project). We caught up with Michael to learn more about what Gradient X is doing, and why the three have teamed up at the company. Gradient X is backed by Rincon Venture Partners, GRP Partners (now Upfront Ventures), CrossCut Ventures, Founder Collective, Siemer Ventures, Baroda Ventures, and Double M Partners.
What is Gradient X?
Michael Lum: Gradient X is looking to build the most advanced, programmatic advertising program for mobile. We know that advertisers are looking to reach mobile users, whether they're on phone or tablets.
How are you doing that?
Michael Lum: We're doing that through real time bidding. It's something that has grown quite a bit in the display advertising world, and in the last year has really been accelerating in mobile. It's really about making your team more efficient.
Talk about your experience, and the experience of your team?
Michael Lum: We have a great founding team. I came from OpenX, where I was head of engineering, before coming over to Gradient X. Brian Baumgart spent seven years at Adconion, and was an early investor, and also built out the company in the early days. Julie Mattern is the co-founder of Rubicon Project. She spent five years there. We have many years of display advertising experience.
All three of you are from different companies, how did you get together for Gradient X?
Michael Lum: We were all semi-independently looking at mobile, due to the growth projection and potential there. So, we came together from our perspective areas to start our own company.
Why tackle mobile?
Michael Lum: If you look at the key trends, last year, there were more phones sold than PCs. This year, there were more tablets sold than PCs. In general, advertising dollars follow the audience. As there has been a shift away from the computer, people are spending more time with their device. That those advertising dollars will follow is only inevitable.
Where are we on the mobile adoption curve for advertisers?
Michael Lum: I think it's just the beginning, honestly. Advertisers are just now dipping their toes into the water. Everybody in the industry is learning more and more, on how to reach that audience, and what's effective there. There's a huge potential in the future.
There are lots of players in this market, why you are different?
Michael Lum: There are definitely a lot of mobile ad networks out there. But, when it comes to programmatic buying, there are not a lot of players. There are a few competitors out there, but in general, there's not a bunch of players in programmatic buying.
For those not familiar with programmatic buying, can you explain how it works?
Michael Lum: Programmatic buying enables an advertiser, using our platform, to bid on impressions on an impression-on-impression basis. You don't have to buy every impression on an app or site. Instead, our software looks at each impression, and our bidding technology decides which impression to buy. That depends on the goal you're after, or how you're trying to drive your reach, whether that's clickthroughs, re-engagement, to drive a sale, for an install, or other activity. Programmatic buying enables you to buy media based on your model.
We notice you have some big brands and early wins. Is that due to your prior experience in this market?
Michael Lum: One of the big pushes out there nowadays is multi-channel marketing. These days, advertisers are looking to reach across multiple forms of media. Social media, display, search, and mobile is also one of them. Because there aren't lots of tools for buying mobile media, we're the leading candidate when it comes to networks trying to fold in multi-channel. We help them to deliver that goal.
What's the hardest challenge with mobile advertising?
Michael Lum: I would say, data is the biggest challenge when it comes to mobile. In the display world, there are lots of standards around you to help you count impressions, clicks, and how websites are categorized and structured. In mobile, there aren't lots of standards which exists, or they're still in the process of being established. There's lots of work to normalize data, and allow people to buy mobile as they are used to on display.