Startup Rocket Fuel claims to apply “rocket science” to ad campaigns, and it sounds like that science is turning into real revenue. The company says it made $44.5 million in revenue last year, compared to $16.6 million in 2010 and $2.4 million in 2009.
In fact, CEO George John tells me that in the fourth quarter of 2011, the company was profitable for the first time. Not that he plans to stay profitable — he says it would be “weird” for Rocket Fuel to be profitable all the time, since it’s trying to grow. Instead, he plans to be “slightly unprofitable” until Q4 2012, when it will probably be profitable again, thanks in part to seasonal cycles.
The company, John says, consists of “nerds trying to help the cool people in marketing do a good job.” Specifically, it works with ad agencies to ensure they’re reaching the audience they want — not just the audience that they think is desirable, but one that will actually click on an ad and buy a product (or convert in some other way). As a result, Rocket Fuel-optimized campaigns can perform twice as well as they did before, which could mean doubling the response rate or halving the cost per lead. John also claims that the software is genuinely fun to use, comparing the company to Mint in its efforts to create an engaging user interface.
Oh, and the “rocket science” thing isn’t a joke. John himself has worked at NASA, and (playing on the fact that he knows I’m a big science fiction fan), he says that he’s currently looking to hire “a couple of robot psychologists that can monitor the autonomous behavior of our adserver and bid-server and explain the macro and micro decisions being made and how this complex behavior emerges from simpler rules and goals that various AI agents have.”
As for his plans for 2012, John says the company plans to release a self-serve product in the second quarter, one that will focus on “self-service analytics, with direct visibility and transparency.” Over time, that self-serve product will include more controls to let the customer direct the ad placement process.
Rocket Fuel last raised a $6.6 million Series C from Northgate Capital and others.