Post-IPO, MaxPoint Grows Q1 Revenue 87% To $28.7 million

MaxPointIn its first earnings call since going public in March, MaxPoint reported revenue growth of 87% to $28.7 million. Its revenue ex-TAC, which excludes the cost of programmatically buying impressions through real-time bidding, rose 90% to $16.8 million. [Read the earnings release.]

The total number of enterprise customers rose 62% to 529. In the first quarter of last year, it had 326 customers, and it has added 50 customers since the beginning of this year. But the majority of its revenue comes from its top 25 customers, who may be buying on behalf of multiple brands.

MaxPoint buys display advertising for its clients, but also mobile, video and social ads. Those grew to 24% of customer spend, up slightly from the year before. Almost two-thirds of its customers bought display and non-display ads, compared to just over one-third the year before.

MaxPoint helps national advertisers drive in-store sales using MaxPoint's digital ZIP technology, which divides the US into 44,000 neighborhoods. It then layers on search technology to figure out the real-time purchase intent of neighborhoods. The technology does not use cookies.

What it ends up with creates more precision than typical geotargeting: “We believe neighborhoods matter, because even though they’re often in close proximity they can be vastly different," CEO Joe Epperson said.

All of MaxPoint's data must tango with its clients' business intelligence, in order to pull in brands' first-party point-of-sale and inventory data.

MaxPoint has been around nine years, setting up shop in a digital environment focused more on ecommerce than in-store sales. MaxPoint wants its technology to steal budgets from the offline media channels where local spend takes place, like newspapers and direct mail.

Explaining his business to investors, Epperson offered a few case studies to explain how the company services customers, who are primarily in the CPG, auto and retail verticals.

A battery manufacturer ran a weather preparedness campaign to drive sales in Walmart ahead of a tropical storm. It ran three days before the storm, turning off automatically. The customer expanded the program later to cover winter storm preparedness in other regions.

A CPG with excess candy in Walgreens ran a targeted advertising program only to overstocked stores. MaxPoint measured the sales lift and inventory reduction. And a national food producer running differently flavored products in different regions was able to support each Sam's Club store with custom messaging about the products available in that store.

The brand marketers buying impressions on MaxPoint pay a CPM with a fixed amount added onto it. The fee is the same amount, within a small range, for each advertiser, CFO Brad Schomber said.

MaxPoint forecasts revenue for the year between $91.5 million and $93 million. Asked by an investor how much of that revenue was secured from advertisers, Schomber responded that it created its forecast by looking at the sales pipeline as well as expected revenue growth from existing customers.

 

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