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By Sayantani Ghosh
Wed Oct 17, 2012 6:18pm EDT
(Reuters) - Jumptap, a seven-year old mobile advertising startup, said it is considering either listing its shares or selling itself, as it looks to snatch a bigger slice of a market estimated to grow to more than $20 billion over the next three years.
Jumptap is among a clutch of small companies, including recently public Millennial Media Inc and privately held InMobi, that are fighting to carve a niche in a market dominated by Google Inc.
"We've looked at it," Chief Executive George Bell told Reuters when asked if the company was considering going public.
"It's a potential path for the company for sure. We are very pleased with the way the industry has responded to Millennial's stock; that's a good thing for us," he said, but added that the company had no firm plans yet.
Millennial Media, which had a very successful debut on the New York Stock Exchange in March, grabbed the second spot in the U.S. mobile advertising market behind Google last year, according to a report by market research firm IDC.
Jumptap, which reckons it is smaller than Millennial and closer to India's InMobi in size, bagged 9.5 percent of the market in 2011, ahead of Yahoo Inc.
Bell led Internet firm Excite to its IPO and later to its $6.7 billion merger with @Home Network in 1999. Bell was later also CEO of college savings service Upromise that was sold to Sallie Mae in 2006.
STAY PRIVATE OR SELL
Another alternative for Jumptap could be to remain private and continue to grow in a market that is expected to triple in size.
The mobile advertising market is expected to double to $6.84 billion this year, according to market research firm Gartner, and hit $20 billion by 2015.
Bell said selling itself to a large mobile advertising network or a big digital company or a company with its own platform could also be a very logical move for Jumptap.
"There's going to be an accelerating amount of acquisition activity. Consolidation and scale has not yet been achieved by anyone with the exception of Google and Apple so there's going to be increasing incentive," he said.
Boston-based Jumptap is often approached by interested suitors, he said.
The mobile advertising market will soon be a hotbed for acquisitions, according to analysts, who predict that companies such as Google, Facebook Inc, Microsoft Corp and Amazon Inc could soon invest in the industry.
"What we do is interesting to lots of companies - to carriers, to media companies, to targeting and data companies. We get approached all the time, but that in itself doesn't mean anything," Bell said.
The company also has some patents that could interest companies such as Google, who already have the reach and a large customer base but may look to add new technology.
Bell, a former managing director of Jumptap backer General Catalyst, replaced Dan Olschwang as CEO in 2010.
Jumptap, which has raised $121.5 million through seven rounds of funding, counts Summerhill Venture Partners, WPP Plc and AllianceBernstein among its investors.
Jumptap, which has about 175 employees, will add 30 percent to 40 percent to its workforce in 2013, and grow revenue by more than 60 percent, Bell said.
(Reporting by Sayantani Ghosh in Bangalore Editing by Supriya Kurane)
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