InMobi Pte, a mobile advertising startup backed by SoftBank Group, is partnering with Samsung Electronics Co. and other device makers as it targets reaching more than 650 million smartphone users.
The partnership will embed technology in hardware so ads display while users are on their device’s home or lock screens, InMobi Chief Financial Officer Manish Dugar said in an interview. The company is working with the “biggest names you can think of” and has signed up two companies outside of India and four inside, Dugar said, declining to name the vendors.
InMobi makes most of its sales with ads in more than 35,000 smartphone applications such as offers for rides through Uber Technologies Inc.’s cab-hailing service while a user is browsing Flipkart Online Services Pvt.’s online store. The embedded technology will bypass apps to reach people while they do other things on their device, helping it compete better against Google Inc. and Facebook Inc. for revenue.
“InMobi has seen tremendous growth to become one of the biggest names in mobile advertising globally,” Neha Dharia, a Bengaluru-based analyst at Ovum Plc, said by e-mail. “In order to keep up with the heavy hitters like Google and Facebook, they need to constantly be innovating and building on their strength - that of serving the mobile first consumer.”
Working with manufacturers also enables InMobi to collect data on people’s location and usage patterns, Dugar said. Information from dozens of internal sensors in the device help understand the mood and activity of a phone user.
“Data enriches my understanding,” Dugar said in the July 20 interview in Bengaluru. “If the sensors show you’re looking at your phone from a reclined angle, I know you are relaxing and I will show you an ad for some soothing music from a singer that I know you like.”
Samsung, which is releasing devices using its homegrown Tizen operating system, is working closely with InMobi, the Suwon, South Korea-based company said in e-mailed comments.
“Details will be announced at the Tizen Developer Summit next week. Stay tuned,” the world’s largest smartphone maker said.
This strategy, along with a new product called “Miip” aimed at making ads more subtle, is part of a push to recast InMobi’s identity. Instead of being seen as an advertising technology company, Dugar said InMobi wants to be “valued” as a provider of insights into individual consumers.
InMobi was valued at $600 million in 2011 based on its revenue of $25 million in the preceding year, Dugar said, declining to provide a current valuation.
Gross revenue in the fourth quarter last year was about $400 million on an annualized basis, or revenue in the period multiplied by four, Dugar said.
The company’s goal is to get a better valuation when it goes for an initial public offering, most probably in the U.S.
“That won’t happen before at least a year-and-a-half,” Dugar said.
InMobi, which turned a profit for the first time in the three months ended December, expects to be profitable again in the third or fourth quarter of this year, Dugar said, without providing a specific forecast.
“The InMobi IPO has been in the pipeline for quite some time now,” said Ovum’s Dharia. “In order to do this they need to show a strong position in terms of their revenue and other financials. All their efforts will be on growing revenue.”