What Rubicon IPO Says About Future of Digital Ads

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April 2 (Bloomberg) -- Frank Addante, founder and CEO of Rubicon Project, discusses why the company went public and what it says about the future of digital advertising. He speaks with Trish Regan on Bloomberg Television's "Street Smart." Sam Palmisano, former chairman and CEO of IBM, also comments. (Source: Bloomberg)

Why did you decide to go public now?

That is a good question.

We are on a long journey.

This is a giant market.

It is a $100 billion market and growing.

I have been at this for seven years.

We have not raised capital in the past three years.

We have been operating on our own cash for the past three years.

We see an opportunity where this is top of mind for people in the industry and we want to accelerate this vision.

It speaks in some ways to this globalization issue that i was just talking about with sam.

Productivity is so important right now.

You look at how it can even affect the advertising space.

Is this the future where you can cut out the middleman and say, ok, i want to put in an x y and z criteria and reach this particular demo and software that can effectively get you that?

If you think about technology, it is basically the ultimate democratization of business process.

It structures a complete how do you see the future playing out?

Our market entry strategy was to start with digital.

But ultimately television as well as even visual billboards someday.

Why is this such an opportunity?

Do you see inefficiencies in the current system?

Absolutely.

There is an effective 60% tax in the market only 40% makes its way to the seller.

Taxes coming from a lot of manual effort and manual work going into these transactions.

How do you see the role of big data as you look into a new business model?

We are processing three trillion transactions on a monthly basis.

Our system interacts with 97% of the u.s. internet population.

No other company in the world reaches more people.

That is three pellet -- 3 trillion pieces of data.

You can optimize pricing, make other matches between buyers and sellers, which makes the overall market of advertising even more efficient.

. congratulations.

. it is a wonderful business model.

One of the frustrations is that you can't really measure -- it is hard to measure the effectiveness of your ad campaign.

It is easier online.

You can give us the data and provide the metric that for these corporations and the target audience, etc., etc.

You almost think that some of this online media would be more precious, more expensive than traditional in terms of advertising because you have the ability to target a -- target exactly who you want.

Is it going to change, frank?

Are prices going to go up?

I think that is changing.

In digital media, you have the ability to purchase an individual impression on an individual user which is far more effective than traditional media for you put out a big yet in the middle of time squaring you have no idea what the effectiveness is.

It's nice to measure it.

Coming up, move over, siri.

There is a new digital assistant

This text has been automatically generated. It may not be 100% accurate.

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