kargo

After A Decade In Business, Kargo Says It’s Growing Fast, With Big Ambitions For Premium Mobile Ads

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By the standards of the startups we cover at TechCrunch, mobile advertising company Kargo is pretty much ancient.

But even though it was founded back in 2003, the company says it’s hit a triple digit revenue growth, with total annual revenue approaching $50 million. And it’s profitable.

Founder and CEO Harry Kargman also told me that Kargo’s headcount has grown about 50 percent since the beginning of the year, to about 85 employees. As a result, Kargo has outgrown its current Manhattan headquarters (pictured above), and there are plans to move into a new, larger space this fall.

When I first met Kargman last fall, his pitch sounded pretty familiar — brand advertising, premium publishers, etc. etc. But the company is actually delivering on that pitch, with a publisher network that includes Hearst, CBSi, Vox, and Meredith, reaching 90 million unique visitors each month.

In an email, Alysia Borsa, Meredith‘s senior vice president of mobile and its chief digital officer, told me that the publisher (whose magazines Parents, Fitness, and Better Homes and Gardens) has been working with Kargo for the past two years.

“Mobile has become increasingly central to our greater digital strategy and Kargo is a key partner from a strategic and revenue generation perspective,” Borsa said. “Kargo is our primary mobile advertising partner, providing innovative mobile ad products and working extensively with our direct sales team to drive revenue. In the last 8 months in particular, Kargo has enabled new integrated ad units and ramped sales with major advertisers.”

Kargman said that integration with publishers is one of the main things that distinguishes the company. He suggested that Kargo is “woven directly into the fabric of the page,” allowing it to integrate rich media ads that go beyond the traditional definition of native advertising.

“Native has been thrown around the industry as meaning only in-stream ad units,” Kargman said. “To us, that is a type of native. But it’s only just scratching the surface of great ad experiences that integrated throughout the content.” (You can see examples of Kargo’s various ad units here.)

As you can probably guess, the company has changed significantly in its 10-plus years of existence. As Kargman tells it, Kargo was once focused on downloadable media like ringtones and games. However, that wasn’t exactly a growing business. Meanwhile, the media companies that Kargo was working with said the real need was in advertising, particularly advertising on the mobile web, so that’s where the company focused — Kargman described it as a process of “existential evolution,” as in, “We figured out that for us to exist, we would need to become really good at developing great mobile web experiences.”

Luckily, Kargo didn’t have any outside investors to get impatient with this process — Kargman said that in March 2008, he bought out the company’s backers and hasn’t taken on external funding since.

Oh, and if you’ve been wondering: Yes, Kargo is named after Kargman himself (at first, I tried to make fun of him for it, but after I interviewed him multiple times, it just started to make sense), and yes, Harry Kargman is married to author and potential TV star Jill Kargman.

As for where the company goes from here, Kargman said the next big opportunity lies in the shift to the automation of ad buying and selling. He said that Kargo has “laid the foundation of having our platform integrated directly onto the page” so that it can give its customers an “end-to-end solution” for programmatic ads.

“When we say, end-to-end, in a nutshell, we mean being able to make it really easy for the brand advertiser to create assets that will actually run [across Kargo publishers] without any of the middle ecosystem,” he said.