I interviewed Millennial Media's Paul Palmieri and Chris Brandenburg for a story that appeared in the Baltimore Sun's Sunday's Business & Jobs section.
Sipping a venti coffee at a Starbucks in Timonium, Chris Brandenburg, a computer engineer and caffeine junky, was ready for a new challenge – and Paul Palmieri was about to give him one.
On that day in April nearly four years ago, the men were at a crossroads in their lives: Brandenburg (pictured left) had just left Advertising.com and Palmieri (pictured right), a veteran wireless industry executive working for an investment fund, was hungry to make his mark with a startup.
Palmieri had several ideas, but the one he talked about most during their coffee shop meeting was an advertising network that would tap the nascent market of advertising on cellphones. Brandenburg was game. Within two weeks, he would go on to build a rudimentary computer server that could dish ads to cellphones – and showed it off to Palmieri.
“He walked me through the demo and it was just like, ‘Wow, we’ve gotta do this. We’ve gotta go hard after this,” Palmieri said.
Soon after, Millennial Media was born.
In less than four years, the Baltimore company has raced to the top of its industry. Millennial Media has raised $40 million from investors, including several million during a brutal economy, enabling it to expand and hire this year. Two of its biggest competitors were recently bought by Google and Apple for hundreds of millions of dollars each – which has driven Millennial’s own worth up, analysts say.
The company is positioned at the forefront of an industry that many say has excellent long-term growth potential. For Palmieri, launching Millennial was the culmination of a long obsession with the combination of wireless technology and marketing.
Millennial’s successful growth thus far is largely a Baltimore story. Several of the company’s top executives are refugees of Advertising.com, which is owned by AOL. The company’s offices are in the city’s incubator space in Canton. When technology observers talk about the next local startup company that could attract a generous buyer or unveil a lucrative public offering, Millennial is usually at the top of the list.
“They are a high-flying company and I think they have great upside potential; they have the talent, they’re building a great team,” said Steve Kozak, executive director of the Greater Baltimore Technology Council, an association for local tech companies.
Kozak compared Millennial to Timonium-based Bill Me Later – “a quiet little company that nobody knew about”—that ended up getting bought by eBay in 2008 for $945 million. “I don’t know what their exit plan is, but I would not be surprised if some really good news came out of that company,” said Kozak.
What has fueled Palmieri’s vision for the company is his belief that mobile advertising is a new, largely unexplored world compared to traditional online advertising. People interact with their cellphones and smartphones when they’re on the move in unique ways, and the gadgets themselves can do things a desktop computer can’t, such as offer location-based services.
But the industry is still young and fragmented, with wide variations in technology, offerings and marketing adoption.
For years, industry prognosticators have talked about the money-making possibilities in mobile advertising. The platform itself offers various choices for marketers, such as text-message campaigns, or advertising within applications or on mobile Web sites.
But it’s only been in the last year or two – with the growing adoption of the iPhone and other high-powered smartphones – that industry analysts see mobile advertising beginning to fulfill expectations. The Interactive Advertising Bureau has projected that the mobile advertising industry will grow from $416 million in 2009 to $1.56 billion in 2013 – fractions of the many billions spent on online advertising in general.
Both men had worked at Advertising.com for a time, but didn't know each other well while there. Instead, they got hooked up by a mutual friend at the company after they had both left. Here's a little background on them.
(click through to read more)
Paul Palmieri is a 39-year-old man who's already started going gray. It's not the stresses of running of a startup that did it to him, though. He said he's been going gray since age 25.
Paul was born in Connecticut and raised on the Jersey Shore by parents who were lifelong teachers. He went to college at Mt. St. Mary's in Emmittsburg, Md., where his father graduated from in the 1960s. He was a singer in a college band called "That's Irrational" that covered songs by INXS, The Cure, The Alarm, Billy Idol -- songs from the late 80s/early 90s.
His first job out of college was selling copy machines in Philadelphia. He quickly learned that he loved sales. His first boss made every employee memorize a mantra that they had to be able to recite on the spot. More than 15 years later, Paul still remembers it and recited it without difficulty:
I will persist until I succeed. I was not delivered into this world in defeat, nor does failure course in my veins. I am not a sheep waiting to be slaughtered by my shepherd and I refuse to talk, walk or sleep with sheep. The slaughter house of failure is not my destiny. I will persist until I succeed.
He spent the first five years out of college working first in sales for copy machines, then for a company that sold commemorative rings. He switch over to the telecom biz with his first job at a Sprint subsidiary in Bethesda. Next stop was Tessco Technologies Inc. in Hunt Valley, where he led a new division in marketing. In 2000, Advertising.com came calling and he did an eight month stint there.
His next big break came from Verizon Wireless, where he ran the data efforts. Back then, revenue from data was only around $35 million a year, Palmieri remembers. By the time he left in July 2005, Verizon's revenue from data plans had grown into a multi-billion dollar business.
He took a break from the corporate world, with ideas about wireless marketing brimming in his brain, and went to work as an entrepreneur in residence at Acta Wireless, a Mid-Atlantic investment firm that helped Palmieri incubate and cultivate his ideas.
A friend at Advertising.com eventually hooked Palmieri up with Chris Brandenburg, 35, a Harford county native and UMBC grad in computer science who had worked as Advertising.com's senior director of enginnering.
Brandenburg, who had extensive experience with complex computer networks from a previous job as a government contractor, nevertheless hadn't been exposed to the mobile ad market during his time at Ad.com. But he was interested in it as an engineering challenge ever since Ad.com was acquired by AOL in 2004. He spent some time on his own learning "how the different pieces fit together", technology-wise, to accomplish mobile advertising.
"But it was not until Paul and I hooked up did I spend a lot of time thinking about how we'd go about building it," Brandenburg said.
After he and Paul met at the Starbucks in Timonium in 2006, he went home and built "a really rudimentary ad server."
"I had an old Motorola and I tried to figure out how to get ads on it," Brandenburg said. "It became a fun project. I showed it to him. We just bounced ideas back and forth. next thing I knew, we were on a plane up to Boston to talk to some VCs (venture capitalists)."
Very quickly after, Palmieri and Brandenburg launched Millennial Media.
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