How Adzerk Made It Big (With Reddit’s Help)

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When James Avery of Adzerk met Alexis Ohanian in New York at an online advertising conference last year, he was ready. He had been angling to work with Reddit, the popular sharing site Ohanian had co-founded, for two years. After a brief exchange, Ohanian introduced Avery to the programming team in a few short months the deal was done.

By mimicking Reddit’s up/down voting system in ads, Adzerk was able to create non-intrusive text and image ads on the page, ensuring that the site’s persnickety readership would have some choice in what they saw one the site. Wrote Reddit senior manager Jena Donlin:

Our primary goal is to make advertisements on reddit as useful and non-intrusive as possible. We take great pride in the fact that reddit is one of the few sites where people actively disable ad blockers. reddit does not allow animated or visually distracting ads, and whenever possible, we try to use ads as a force of good in our communities.

After the implementation, Adzerk’s traffic doubled. In December of last year they saw 2.5 billion impressions while in March they crossed the 7.8 billion mark. The Durham-based company had seen slow growth before but now it was on fire. Luckily, they were ready.

“I wrote the first version of Adzerk while running those networks and later spun it out as it’s own company in 2010. Last summer I hired Nate Kohari as our CTO and he has done an amazing job of building out our engineering team and leading the rewrite of our ad server in node.js,” said Avery. Before Reddit the company had raised around $1 million in funding, a fairly in the world of ad networks.

Avery himself moved to Durham, North Carolina, an up-and-coming tech hub that had a low cost of living and lots of great talent coming out of the local research parks and universities. “I moved to Raleigh from Cincinnati looking for a better technology scene and I was surprised to find it in small Durham instead of in Raleigh,” he said. “I think one of our biggest advantages is that we aren’t in NYC in the middle of adTech – we can take a step back and focus on the real problems.”

They saw excellent pick-up from Onramp users who were moving from the hacked service and Reddit was helping them open doors nearly everywhere. By April they saw 11 billion impressions from 825 active accounts, a three-fold increase.

Avery’s lesson, if there is one in this case, is that patience and planning pay off. He built his company as an API rather than a service and his “platform approach” allowed Reddit to open source the connector software between their ad platform and the sharing service. This sort of transparency is important, especially to an audience as vocal as Reddit’s.

“Adzerk started as a project to build a better platform for running the two vertical ad networks I was operating at the time. I created it because the current ad servers weren’t built in an extensible way where a developer like I could build on and extend them in the ways I needed to,” said Avery.

“We saw this because of the similarities between Stack Overflow’s approach and Reddit’s approach – and how they both find the same things very useful,” he said.

By building intelligently, living and working in a small, hot city, and by aiming for the big guy in his space, little Adzerk made it big. His formula, while not completely reproducible, is indicative of a new normal: that the little guy can reel in the big fish.