There is no escape from the advertising recession. Not even for hotshot TV advertising startup Spot Runner. Despite having raised more than $100 million, half of that as recently as last May, the LA-based company may be in for a major round of layoffs next week following the election (and the associated last-minute media blitz).
As many as 25 percent of its more than 300 employees may find themselves without a job come next Thursday. While the exact number has not yet been determined, I have been able to confirm that the company is currently going through a cost-reduction planning process and is looking at all options in light of the deteriorating advertising environment.
Any job cuts would be on top of an earlier round of layoffs last August, which resulted in 50 people losing their employment. Another 50 or so subsequently left on their own account. According to one former employee who quit, morale is low and a sense of disillusionment permeates the company, at least among the engineers. That’s not a good thing for a tech company. This engineer describes Spot Runner as being more of a tech facade for a regular ad agency.
Spot Runner ramped up employees too fast in a rush to grab market share before Google gets truly serious about the same Web-mediated TV advertising opportunity. Now, it has to worry more about making its cash last and getting to profitability. The number of expected cuts among employees is another 50 to 75. But, again, our understanding is that the exact number has not yet been finalized. When and if job cuts occur, we will add them to our Layoff Tracker.
Remember Spotrunner’s TV commercial?
http://www.yout...h?v=-GbyU3SgRzM
If that spot wasn’t produced/trafficked with/on the Spotrunner platform, then it clearly demonstrated the shortcomings of the company.
Well, the “engineer” you spoke of isn’t alone. Everyone is there to make the sales folks look good. That’s it. Period. Everything else is truly a facade.
I guess it’s all down to scalability: particularly in the current economic conditions, it’s virtually impossible for a start-up to compete with the likes of Google for a product and market that is only incumbent and demands a lot of resources.
What sort of thing does this mean on a macro scale? I only read a little bit about the company, but they do internet advertising on television? I’m lost here.
Read the Crunchbase profile for background on the company:
http://www.crun...pany/spotrunner
Justin: You’re not alone. The entire company is lost in regards to what they do.
Darla – How do you know? Are you an insider? Where do you get your unique insight?
Yes. I am an insider. My unique insight comes from first-hand accounts of the circus sideshow that is Spot Runner.
their ceo remains remains bigger than life! there is only so much one can eat in one sitting, nick!
You have to see their political ad templates…
http://www.spot...VAdLibrary.aspx
I guess it’s all down to scalability: particularly in the current economic conditions, it’s virtually impossible for a start-up to compete with the likes of Google for a product and market that is only incumbent and demands a lot of resources.
http://www.egitimbilgisi.tr.gg
Does anyone actually think that this company can survive the downturn? Add them to the deadpool!
another lesson that companies that are overhyped and seem larger than life eventually come back down to earth. sad for the employees, but always a good reminder. “larger than life” CEOs do well during bubbles and they crash the quickest and the hardest during the bust.
When Joanne Bradford quit after just a few months at SpotRunner, and landed at Yahoo, it seemed like she must have uncovered a disaster and ran away before its stench could affect her. That is a great sign for Yahoo, imo. Someone smart enough to see through hype.
Agreed. Joanne is smart and jumped ship just in time. Funny how SR hired her from Microsoft, Microsoft makes a GREAT offer to SR, the deal goes away in an extremely “embarassing” way, and THEN Bradford jumps ship.
Hmm….
http://valleywa...unner-ad-agency
…what a drag.
darla,
I dont think you know what you are talking about . . . you sound like just another bitter employee/ex-employee . . . you dont have to reference gossip blogs for facts if you truly know anything
Ah, but I felt compelled since the gossip was true.
And bitter? You bet.
if only this company was the only one to fire people
more and more layoffs will follow
cant wait to get off this damn crisis
I have heard that they are actively hiring in Pune, India for their online arm – Weblistic
Layoffs will happen on Tuesday in hope that the news is not covered by most papers since they will be covering the elections. Rosabel will also tell us that they let go of 100 but are going to hire 125 to focus on the new business lines. Just like last PR release from her after the last layoffs.
The rescinded most of those offers (last time and this time).
anybody know the revenues for SpotRunner…300 employees is a lot…they must be doing at least $25 million, yes or no?
About Spot Runner – “Spot Runner is a technology company that is developing the next generation of advertising services. Spot Runner’s mission is to make advertisers successful by revolutionizing the entire advertising process – including the way it is created, targeted, planned, bought and sold. Spot Runner is unique in that it employs proprietary technology and analytics to inform every media plan, target advertisers’ best prospects and optimize each campaign across television, the Web, radio or out-of-home.”
Whew! A little too ambitious. Whoever (un)luckily survives next week will be working mad hours.
So, are the majority of these comments from one former/ current Spotrunner employee that is a tad bit pissed? LOL
I worked at Spotrunner. They hired people across America and laid most of them off withen months . They hired all these people without a clear national business plan. The sales team was forced to run in circles based on what the plan of the day was. The fact is they are not in shape to handle National Advertisers. I for one would not subject my clients to what they had to offer. The word is they have not put new business on the books in over 6 weeks. They are a sinking ship on the national level at least.
They suck! They laid off 50 people in august and swore up and down this was an reorganinazation issue. They were going to rehire people with different skill sets. Funny they never did. In fact 8 weeks later here they go again. The people they let go had the matching skill sets that are listed as of today on Spot Runners job list. In fact many of those let go were only there a few months not nearly enough time to be lack of job peformance. I understand lay-offs. But they should have told the truth instead of publicly dissing the ones they laid off for lack of skills when they is clearly not the case. They recruited good hard working people who left good jobs to come to spot runner only to be laid off after a few months and made false statements about lack of skill sets all to save their name. It’s not surprise to me they are failing. This company is not run by good people.
lol. I’d rather get pink slip and collect severance than continue working there. We’re all hoping for it, that’s how bad it is. The place is a joke, always has been.
Ok, So I am going to start a company that raises a lot of money at high valuations while I am selling my personal stock at the same time. Some people will call me a great salesman, others will say that I am a con artist.
Spot Runner never passed the smell test. They supposedly were a technological improvement on buying media, but they were never connected to the buy side or the sell side. At the same time they were telling people that they were fully integrated. Unfotunately they never talked to the buy or sell side systems, let alone spent the dozens of man years necessary to make the connections. Spot Runner was a complete con job of the investors to the people who joined the company thinking that the company had something special rather than just a pile of BS
Oh… and I forgot to mention that when people lie when they are raising money, they should go to jail.
Most frustrating thing has been that they’ve been hiring right up to the layoffs… twice! It shows a complete disregard for their employees’ well being. Or it shows a total lack of forward planning. They’re either clueless or jerks. In a couple cases, I’ve met people who just started 2-3 weeks ago. I’d be shitting bricks if I were them.
I spoke with SpotRunner early on and I was shocked by the incompetence.
After inquiring about TV ads their sales reps sent me an email pitching SEO. It looked like it was written by a ten year old. I couldn’t imagine giving them money.
For those who don’t know, almost 20-30 employees already quit since the last round of layoff in August. Thats the worst attrition rate I have experienced in some recent years.
Every week 2-3 employees putting in their resignation….that was efinitely not what Nick and David were expecting. Several of the old time Directors too have jumped ships.
Good luck to those left behind!! Hope things work out your way.
Rumor is that Spot Runner would only pulled in about $1M a month by selling at the National level. That is roughly $12M/yr and definitely not nearly enough to keep the boat afloat or keep the investors happy.
The whole company was built on buzz. New employees were offered sub-par salaries and tens of thousands of stock option each year, which would only be fully vested after four years and if and only if the company went public. New employees were thinking, “SpotRunner is the next Google.” With options valued at under a dollar, new employees were thinking that they’d cash them out for $10/share minimum, and take home an extra $500,000 – $5M after working only 4 years. Therefore everybody jumped at the opportunity to get part of the action.
The reason why the old time directors and solid employees left, especially good ones like Tim Lambert, David Day, and Cindy Gauger, was because they eventually realized that they’d never become rich cashing in those worthless stock options. The former CFO and now President, John Gentry, and his ex-Overture cronies, Dan Scholnick, Justin Wheeler, along with the poor direction of Nick Grouf, were too busy focusing on minutiae and not enough on producing a product that worked well.
Within my first two weeks on the job, I could look at the numbers and see how little money the company was actually making. I doubt it was enough to pay the rent on the Wilshire office as well as the sub-par employee salaries. They never had a good enough strategy to make money. Too much time was wasted on obtaining small business customers, which was the whole reason the company was founded. Finally after 12+ months of floundering with this broken strategy, they shifted focus on national accounts.
But even if many businesses contract with SpotRunner to handle their national advertising accounts, they still don’t earn that much money. At the end of the day SpotRunner is a TV spot broker: they buy discounted TV commercial time and sell it for a small profit. It is really not a business that scales too well, since they have to bid on air time just like everybody else.
It is all blue smoke and mirrors at SpotRunner. There was a big brain drain and it’s just a bunch of washed out wanna-bees with a sunk cost of a time investment that will never pay off. I almost feel sorry for my old co-workers and bosses who are still there.
Almost.
Advertising in a way is a luxury and thus you can expect a lot of revenue volatility depending on the state of the economy. You’ll make a lot of money during expansions but topline with shrink during downturns.
Looks like the next round just happened. About 100-115 people including my significant other.
The standard handout is 2 weeks of the already substandard pay and a “don’t let the door hit you in the ass on the way out” as you are told to be gone within an hour or so from receiving notice. This is about on par with the treament the people I knew from there got during their employ, so no suprises there’s massive brain drain long before this current wave of layoffs.
They broke two of the most fundamental tenets:
Business Rule 1: Know what you’re selling (business plan)
Business Rule 2: Take care of your talent (meritocracy)
These are especially important in any creative field, even a low end market like “stock advertising”. Oh well, there’s a big lesson for the next batch of startups on our next upswing…
unemployed as of today. Hello unemployment!
It’s sad that nick was able to raise $111M and have nothing to show for it 4 years later. This is his 3rd venture and hopefully his last. I don’t see investors willing to give him money after this screw up. Sorry to all the people that lost their jobs with this round…
Seriously you all need to check your facts. I’m not too happy about what happen today since all my department was laidoff. It sucks but have you all forgotten how bad the economy is right now. Big giants as Yahoo are laying off people too. Tons of companies are laying off people left and right. Every company needs to reduce in order to stay a live, this is what had to be done. WPP had a profitable 3rdQ but still see a grim future for 2009.
So make a few bad acquisitions, then layoff 50 or so, watch Joanne Bradford walk, blame her, then when morale is nice and low, lay off another 115 people while simultaneously spinning the company in a new direction. Not sure what the decision makers are thinking, I would just jump ship.
There were total 119 laid off at Spot Runner on 11/3.The reaon was “Bad economic conditions”.
I think SR is a sinking ship, good luck to the rest of the employees
If Spot Runner goes under that would leave CheapTVSpots and Spotzer. Cheap TV Spots makes custom TV and web ads and they are still hiring, so that means businesses are still advertising. But what about Spotzer? I know that they boasted that they followed or were inspired the Spot Runner model. Is Spotzer still operational? I tried to contact Spotzer a few weeks ago but have not heard back. Did they burn through their 40 million and go back to Holland? Hope not. Anyone have any info?
Thank You
These companies which include Spot Runner, TurnHere and several others have no idea what drives local advertising. There big shells of lots good press to get a big company like Google or Yahoo, etc to buy into their game in a few years for 10 times what the investors put into it. Just watch…
thanks….
http://www.beymod.com.tr