Start-up poster boy InMobi may hit $1-bn revenue

India's first Unicorn sets up group firms to help it cross the milestone

Seven years ago in November, mobile ad network InMobi’s founder and CEO Naveen Tewari reached a wrong venue and had to rush across peak traffic in Bengaluru for making it to a Nasscomm event. When he finally arrived on stage, he dramatically changed out of his formal shoes and into sports footwear. This, he had said, showed the need for entrepreneurs to change track. 

Changing tracks is not new for Bengaluru-based InMobi, which competes with Google and Facebook for data-driven mobile advertising. After having gone through multiple transitions, InMobi’s latest becoming a global provider of enterprise platforms for marketers (Unified Marketing Cloud) from being an independent mobile advertising platform. This, is going to help the company “cross $1 billion revenue in the next 18 months”, a person with direct knowledge of the development said. 

The firm has also set up two other separate business units — TruFactor and Glance — and transitioned into a group structure that would help it achieve the milestone. The company has already crossed over $500 million in revenue for FY18-19, according to sources.
 

“The company has morphed from what it was at one point of time to becoming highly relevant for the modern marketers and advertisers,” said Sanchit Vir Gogia, chief analyst and founder of Greyhound Research. 

InMobi has set up ‘Unified Marketing Cloud’ business unit where it has developed its own software that it is selling to the enterprises and provides cloud-based intelligent mobile platforms for enterprise marketers. This transition was being built on InMobi’s existing core business of mobile ad-tech. Last June, it formed a strategic partnership with Microsoft and the company had created its software on top of Microsoft’s cloud computing platform Azure. According to sources, Microsoft CEO Satya Nadella is actively engaged with the firm and both the companies are innovating together. The collaboration is also expected to help Microsoft in the area of mobile ad-tech and compete with players such as Google and Salesforce. This platform has been profitable and growing 40 per cent year-on-year, according to sources. “I think the Microsoft relationship is going to be absolutely a game changer for them. If you look at Microsoft stack, they were missing marketing and advertising technologies,” said Gogia.

InMobi was backed by top investors, Masayoshi Son’s SoftBank, Kleiner Perkins Caufield & Byers and Google’s early investor Ram Shriram’s Sherpalo Ventures. The firm became India’s first unicorn, a start-up with a valuation of over $1 billion, when it received an investment of $200 million from SoftBank in 2011.

TruFactor, an independent business unit for telcos, aims to enable telcos transform their digital assets into strategic knowledge. It was derived from InMobi’s acquisition of Pinsight Media, the mobile data and ad firm formerly wholly-owned by US carrier Sprint, for an undisclosed amount last October.

Glance provides a content discovery application. Glance is essentially a pre-installed plug-in on smartphones that allows InMobi to show content on users’ locked screens. It features content in the form of images or video with a hint of text, typically in categories like news, entertainment and promotional. Users can swipe to see the next placard of content. About 65 per cent of all new smartphones in India have Glance pre-installed. It has formed partnerships with original equipment manufacturers and telcos such as Samsung, Xiaomi, Vivo, and Gionee. Within three months, the platform has attracted 26 million daily active users in India.

Last January the company said it had bought Los Angeles-based start-up AerServ for $90 million in a cash and stock deal. AerServ helps mobile publishers grow revenue through its ad mediation platform.

Naveen Tewari, founder and CEO, InMobi, had started mobile search venture mKhoj in 2007 from a single-bedroom Mumbai flat, along with IIT alumni Amit Gupta, Mohit Saxena, and Abhay Singhal. But the model failed and the team pivoted to create a mobile in-app ecosystem and rebranded the firm as InMobi. 

In 2015, it launched an artificial intelligence discovery platform Miip. But the platform, which displayed ads to people about products and services that they actually want to buy, couldn’t create much impact 

on the market.

Picking up pace

InMobi has raised a total of $320.6 mn in funding, according to Crunchbase

InMobi’s main funding rounds, according to Crunchbase and other sources:

Jan 2007 > Gets $500,000 from Mumbai Angels

Jan 2008 > Gets $7.1 mn from Sherpalo Ventures, Kleiner Perkins Caufield & Byers

Jul 2010 > Receives further funding of $8 mn from Sherpalo and KPCB

Sept 2011 > SoftBank invests  $200 mn in InMobi

Sept 2015 > $100 mn in debt financing from Tennenbaum Capital Partners