Fireside Chat

Featuring 

Rajeev Goel, Co-Founder & CEO

PubMatic

Co-hosted by

Michael Seidler, Founder & CEO

Boris Fridman, Managing Director

Madison Alley Global Ventures

August 18, 2021 @ 1 – 2 pm ET

EXECUTIVE HIGHLIGHTS

Introduction  

MadisonAlley.tv virtually hosted an exclusive Fireside Chat featuring Rajeev Goel, Co-founder and CEO of PubMatic.

Pubmatic is a leading sell-side advertising platform (SSP) that delivers superior revenue for publishers (IPO: Dec 2020, NASD: PUBM).

Overview of Rajeev Goel

• Co-founder and CEO of PubMatic
• Former Co-founder and VP of Technology at ChipShot.com, a leading online retailer of custom-built golf equipment
• Former Principal at Diamond Management and Technology Consultants, an IT strategy consulting firm for Fortune 2000 clients

 Snapshot of PubMatic

• Founded in 2006
• Led by Rajeev Goel, CEO. and Amar Goel, Chairman & Chief Innovation Officer
• 14 Global Offices
• 3 Acquisitions
• $63M in funding through Series A-D investment rounds
• $957M valuation at IPO (Dec 2020)
• $1.4B Market Cap

-Interview-

Pre-PubMatic

Rajeev attributes his entrepreneurial spirit to his parents’ journey to the U.S. as immigrants. Conversations around the dinner table about technology, innovation, ideas and ventures were crucial to his and his brother’s penchant for entrepreneurship.

Prior to founding PubMatic, Rajeev’s entrepreneurial venture with ChipShot.com developed his philosophy around capital efficiency and influenced his capitalization strategy for PubMatic.

Founding of PubMatic

Rajeev witnessed the digital advertising landscape shifting from contextual to personalized audience-focus in the early 2000s, inspiring the concept behind PubMatic. He and his brother noticed that publishers’ needs were not properly serviced or supported with automated products and technologies, enabling an opportunity to focus on the sell-side of digital advertising.

Originally, VCs were not amenable to this new and innovative approach, but as a contrarian, this motivated Rajeev to pursue PubMatic’s unique concept of serving publishers. At the time, PubMatic was the first ad network optimization platform on the market. Within 24 hours of their launch, PubMatic had 1000 publishers signed up for their services, signaling to Rajeev and the market that they were resonating with a real need.

Propriety Ad Technology Platform

Rajeev discusses how PubMatic takes an infrastructure approach that is real-time and data intensive. To ensure that speed is best-in-class to deliver content to consumers, it has been crucial to own their own cloud infrastructure that extends close to the consumer rather than use the public cloud, to attain the speed and impact that advertisers need to engage consumers.

Owning all aspects of the infrastructure allows PubMatic to attain the data and analysis needed to target consumers more efficiently and offer these services to publishers at a lower cost. Rajeev believes that this approach has secured PubMatic’s spot as the leader in terms of clients, profitability, and, notably, transparency with clients.

Capitalization and Acquisitions

Originally, many VCs turned down Rajeev and his brother Amar’s bid for capitalization. One particular investment Partner was able to see the need that PubMatic provided to publishers as a great opportunity in the space. This experience inspired him and Amar to focus on individual investors rather than firms.

Focusing on the investor enables PubMatic to develop a more personal relationship with the individual(s) within a firm and foster a partnership. His philosophy is to seek out investors who have been entrepreneurs, founders, or CEOs to ensure that his financial partners understand the nature of growing businesses – including the trials and tribulations.

One of the company’s major milestones was in June 2012, when PubMatic raised $32 million from August Capital. The partner at August Capital helped PubMatic strategize to preserve equity following the Series D investment, enabling the Company to remain capital efficient until its IPO in December 2020.

Scaling to IPO

Rajeev believes being nimble has been important as the landscape shifted throughout PubMatic’s lifespan, remaining on the forefront of innovation in digital technology, streaming, and privacy concerns. He jokes that the only surprise he’s experienced in their successful IPO was that it took so long.

PubMatic prepared to go public in March and April of 2020, at the height of the pandemic. While it might not seem like a suitable time to prepare for an IPO, Rajeev’s contrarian approach led to this prudent decision.

The Company’s cost efficiency enabled PubMatic to stay profitable during the market collapse at the beginning of 2020. During this time, PubMatic increased expenditures, banking on the increased digital activity during the pandemic and beyond. This enabled PubMatic to be well-positioned as the market shifted online, taking advantage of the upturn in Internet use to grow and move towards its IPO.

Post IPO Growth

PubMatic’s success has soared since its IPO in December 2020 to its current market capitalization of around $1.4 billion.

Rajeev attributes this value growth to three primary components: i) investors recognizing that a usage-based model is ideal for revenue retention and thus, profit growth; ii) investors realizing that the “walled gardens” of Facebook, Google, etc., are no longer the only route for digital advertising and that there are a lot of advantages to ad inventory from independent publishers; and iii) there are more companies in the sector, forcing investors to learn more about the space and acknowledge the massive potential for investment.

PubMatic has also been heavily investing in privacy and consumer-based solutions to respond to regulations and foster growth amidst an ever-changing digital climate.  Rajeev believes that the future of AdTech resides in CTV, online video, and display, and notes that PubMatic will be ready and able to serve their clients in whatever latest ad formats may present themselves in the future.

Q&A

What is PubMatic’s acquisition strategy post-IPO?  -Stephen Caffrey, display.io

Pubmatic is open to acquisitions that meet one of three criteria: 1) accelerate the Company’s product roadmap, 2) bring in new customers, and/or 3) drive advertisers and agencies to consolidate more spend onto PubMatic.

Since the IPO, PubMatic has been investing in its product capabilities and growing its engineering and customer success teams.

What is one of the biggest mistakes you now are able to realize you made, that perhaps prevented a more desirable outcome? -Kathy Argyriou, Head of Publisher Sales, Freewheel

Rajeev recounts that he wishes he focused more on culture and employee experience earlier in the company’s lifespan. While employee satisfaction has been a strength over the past 5-7 years, he now realizes that he should have prioritized that part of the business sooner.

Early on, who were you influenced by most? -Ken Kula, CFO/COO, Eleven

Growing up in Silicon Valley allowed Rajeev to watch Elon Musk, Steve Jobs, and Jeff Bezos develop into the leaders and icons that they are today. He’s been particularly influenced by their common trait: a relentless focus on building products that solve customer needs in new and innovative ways.

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