Loren Hillberg recently took over as General Manager of Thinknear, replacing company founder Eli Portnoy. We caught up with him recently to talk about the transition from the entrepreneurial stage of a business to the scaling stage, the future of mobile-local advertising, and the coming wave of consolidation.
Let’s take a step back first and talk a bit about the general state of the mobile-local advertising category. What are you seeing?
It’s a really exciting and still quite frankly new and young category. It has some historical elements that go way back — like the wanted ad in the local circular — but what’s happening in mobile and where different companies are trying to enter the space and deliver new technologies make it wide open. I think it will ultimately be exciting from the consumer perspective. I think they will be better served by the kinds of information that they are getting.
You recently took over as GM. How quickly are you figuring it out in terms of what’s working and what’s not working?
I’ve been trying to explain to people what it’s like to jump into the deep end of the pool with respect to the ad industry as a whole, which is pretty complex when you look at all the players involved. And then, you jump further into that pool with the different types of ad technology, different delivery systems, and different things that advertisers want to do in terms of marketing to their potential customers. I’ve been helping the Thinknear team in an advisory or supervisory capacity for a couple of years now but I didn’t necessarily dig down into all the little pieces. In the last two and a half months since I’ve been leading the team, it’s been a real challenge to understand everything.
You don’t want to get into the habit of putting everyone into a simple box because everyone is trying to do a different thing and that’s important to recognize. But on some level, just to be able to understand the industry you need to have a few boxes. Even getting people into a collection of competitors is a little bit of a challenge. You have to become very familiar with a lot of different technologies. On that front, I would say I think I’m making quite a bit of progress but there are still times when people will say something and I have to say to them, ‘You know, I’m not quite sure I understand. Could you help me out a little?’ That’s just the way it is.
What are some differences between you and former GM Eli Portnoy in terms of how you think about what you need to accomplish?
I think Eli and I had a common understanding of where we were trying to go. I wouldn’t say we were 100 percent aligned because that’s pretty strong alignment — but I would say we were pretty substantially aligned with the direction we wanted to go, particularly with the technology assets that Thinknear has today and where we think we are best suited to build in the future. I feel like the transition in leadership is a lot more about the the shift from entrepreneurial stage to more of the scaling and building out stage, not so much the where is the industry going stage.
Thinknear made a big push in 2014 to expose the rampant amounts of “dirty data” flowing through the mobile advertising industry. Is that a long-term differentiator?
I would certainly say that not everyone has gotten there. Our Location Score service solution is an initiative that shows that the industry as a whole has caught up. I do believe from a pure technology perspective, people will continue to get better in that area. That’s a good thing for clients. We believe that because we started there first and because we work on it in a continuous way, we probably always will have a better solution than our competitors. If you go back a year and a half, we thought we were 50 percent better than our competitors. That’s a lot tighter margin today.
Because of that, and more importantly, because advertisers are looking for more than just a simple geofence solution, we are looking at all the other aspects of data and services that we think we need to provide to give them a really complete solution for all their needs.
Right now, a number of mobile-local ad firms are making a lot of money, but most remain in the pre-IPO phase. Do you think that these companies can build a sustainable, freestanding businesses around location? Or, is consolidation inevitable?
Given how early we are in the development of this space and the scale of it as a whole, there is no doubt that there will be consolidations occurring. But they will be occurring at least as much from a strategic perspective as it is from a scale perspective. I do think there will be a couple winners on the mobile side who will have a chance to be really scaled up entities that deliver value long-term. I’d have a hard time picking those people today. I’d like to think that Thinknear, particularly with our Telanav parent and the different technologies we can bring to bear, are giving ourselves a really good opportunity to be one of those winners.
Is that consolidation going to start happening soon?
Even within Telenav we look at other companies we think might be interesting. I’m not going to give you any names [laughs] but we’re looking at what’s happening in the industry and trying to decide whether any particular vector that people are going on may have a much longer life. I have to believe that our competitors and the larger players in the industry are doing exactly the same thing. I do believe that some of the newer public companies will base some of their strategy around taking advantage of the stock as currency to do some acquisitions.
I think you’ll see some movement in the coming year. There’s been some movement in the past year. But I would say that if you’re looking for the bigger, marquee deals, they might be coming not next year but maybe a year or two down the road.
Noah Davis is a senior editor at Street Fight.