Innovator: Omar HamouiBy
Two of the biggest tech innovations of the past 10 years are Net-connected smartphones and Google's (GOOG) technology for delivering relevant ads alongside Web search results. It took Omar Hamoui, who founded an ad network called AdMob in early 2006, to meld those worlds into a new industry: advertising on mobile devices.
Companies use AdMob to place ads on Web sites appearing on mobile phones and in applications downloaded by users of the Apple (AAPL) iPhone and Google's Android devices. Since its launch, AdMob has placed nearly 200 billion ads in this fast-developing market. Today, the mobile-phone ad market represents only $1 billion of the $60 billion spent on online advertising, but analysts expect mobile ads to become a $10 billion business by 2014.
This explains why Google and Apple got into a bidding war over AdMob last year. It ended with Hamoui accepting Google's $750 million offer. (On Apr. 9, Apple unveiled its own new mobile advertising system, called iAd.) AdMob operates out of an office above a restaurant in San Mateo, Calif. It had revenues of about $60 million when it was acquired, according to two people familiar with the company's finances.
The idea to launch AdMob came to Hamoui back in 2005, when he was a first-year MBA student at University of Pennsylvania's Wharton School and wanted to build traffic for his fledgling company that made photo-sharing software for cell phones. He tried marketing the service with search ads on Google, but found it cost way too much. There was no easy way to target potential customers by advertising directly on cell phones. When he finally found a company that made smartphone apps willing to display his ads on their software, he was shocked to find it cost him only 10 cents for every paying customer he attracted, compared with $30 when using Google.
"We happened to be talking about inefficient markets in one of my finance classes—about how there's lots of money to be made when buyers can't find what they need, and sellers can't sell what they have at the right price," he says. So he scrapped his earlier company and set to writing the code for an e-marketplace where advertisers could create and distribute ads just for mobile-phone owners. AdMob enjoyed near-instant success. Advertising clients, which now include Ford (F), Coca-Cola (KO), and Paramount Pictures, were thrilled by the ability to target well-off smartphone users. Google bought AdMob to expand its online ad empire to mobile devices—a prospect that has the Federal Trade Commission weighing whether to block the deal. Regardless, Homoui sees huge growth ahead. "In 10 years," he predicts, "mobile advertising will be bigger than online advertising."
Launched an ad network that's powering growth of the mobile Web
Turning down a buyout offer from techdom deity Steve Jobs
MBA from the Wharton School; UCLA computer science degree