Online And TV Ad Firm Spot Runner Lays Off 50 Employees, But Adding 40 More
Spot Runner, the heavily backed and high profile online and TV ad agency based in Los Angeles, laid off about 50 employees, the company confirmed to me late today. Rumors to this effect started leaking out earlier today andlast week, though the numbers were wrong, and the company says read too much into the reasons for these changes. Company spokesperson Rosabel Tao, VP of corporate communications, told me that the layoffs constitute about 10 percent of its employees, but at the same time, it is hiring another 40 employees in various positions, so will come out about the same as before.
The reason? Tao says earlier this year, the company started to reorganize itself along three business lines. The company started as a TV ad seller using online, focused on small businesses, but has grown from there and added online/search, radio and other local sales channels to its portfolio. To build on those, it recently did some major hires, including former Interpublic CEO Mark Rosenthal as president of Media Platforms and vice chairman, and Joanne Bradford, former head of MSN, as EVP. Rosenthal is heading the media platforms, Bradford oversees national marketing services and Kurt Weinsheimer manages local marketing services. As part of that reorg, these redundancies were made...
Spot Runner lays off 50 as it realigns its strategy
Spot Runner, which lets advertisers place to local TV stations via an online service, has laid off 50 of its employees as it realigns its strategy.
The company says the layoffs amount to 10 percent of its employees and it plans to hire another 40. The news of such drastic changes is surprising, since the company has plenty of cash in the bank from a $51 million round announced in May.
Earlier this year, Spot Runner started to reorganize itself along three business lines. The company started by selling TV ads for small businesses. It helped automate the media-buying process and created relationships with a variety of media companies.
The business works like this. A local business owner visits the Spot Runner site, selects a business category and chooses from a lot of generic, pre-taped video ads. Each comes with voice-over text that can be customized. Then it tells Spot Runner how much it wants to spend on TV air time and which media markets it wants the ads to run in.
Now Spot Runner has added online search, radio and other local sales channels to its portfolio. It hired former Interpublic CEO Mark Rosenthal as head of media platforms and vice chairman. It also added Joanne Bradford, former head of MSN, as executive vice president to oversee national marketing services. Kurt Weinheimer runs local marketing services.
The May round’s investors included media companies Daily Mail and General Trust (DMGT) and Grupo Televisa, along with investment institutions Legg Mason Capital Management and Groupe Arnault/LVMH. Existing investors also invested, bringing the total funding raised to date to $111 million.
At the time of the funding, Nick Grouf, CEO of Los Angeles-based Spot Runner, said the company would expand into online and offline media, both domestically and abroad. Spot Runner’s previous investors include Allen & Company, Battery Ventures, Capital Research and Management, CBS, Index Ventures, The Interpublic Group, Tudor Investment Corporationand WPP.
The startup just got some competition from search and online ad giant Google, which recently announced the general availability of its TV ad program. It also competes with Jivox.
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Baloney. Layoffs are significant. In my opinion Spot Runner is on deathwatch. They got beat by CheapTVSpots for quality and price and there may be no chance of recovery for spotrunner and their 100 million investment. The industry doesn't need them. It's already being done cheaper, faster and better. And I think most national brands will sense their blog-hyped amateurish operation and shun them.
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