To say 2012 was a bad year for Eric Wheeler would be an understatement.
That year, Wheeler’s company, 33Across, which offers a platform that automates online advertisements for companies, lost millions of revenue in its pipeline. The company went from near profitability to deep in the red and 70% of its employees had to be let go. Wheeler, who founded the company in 2008, says seismic shifts in the online advertising industry wiped away major parts of its ad network business.
“This wasn’t just a bad quarter. This was like climate change. We have a problem, the ocean is rising…and in this case, half of our business fell into the ocean.”
For many companies this is where the story would end, another victim of a rapidly changing industry. Programmatic advertising had taken over and there was nothing that could be done. But 33Across accumulated its brightest minds to pivot the business. They leveraged technology it had acquired from a company called Tynt and designed an online advertising platform that appealed to the supply side and was created for viewability. Most programmatic advertising has 50% viewability, but 33Across’ platform guarantees 100% viewability for all ads.
In seven years, the result is the company has reached $100 million in revenues and its workforce has climbed back up into triple digits. Wheeler spoke to Chief Executive about staying ahead of the trends, how he rebuilt 33Across’ culture with transparency and more. Below are excerpts from this interview.
How do you stay ahead of the trends of this rapidly changing industry and not just the trends today, but the ones that will be in place 5-to-10 years from now?
I actually think that as with any business, you constantly have to be planning for what’s next and how you will evolve. And part of that is making sure that you haven’t matured in that growth curve. You see much more pipeline coming in the next two years, three years, four years. One of the things that we do as a company is we’re constantly putting effort into future development and future innovation because there’s so much we’re learning for our customers every day. We’re constantly having feedback with them on what’s working, what’s not working, where the industry is moving.
Technology in the advertising space, it’s so advanced that you have to be constantly prototyping. I would say 60% of our initiatives are the business at hand today. How do we scale the business? We have 30% of the initiatives are what are the adjacent opportunities we have? What are the other things we can take our existing position and expand on and scale that? And then 10% is what are the really breakthrough things we can do that’s truly transformative and things that could be an entirely new business model?
The crazy story about the pivot was in one year we lost basically $20 million in revenue from the existing business we were in. We went down to almost nothing. We were able to pivot quickly from no revenue to $20 million in one year. It was an example of changing the engine midflight. It was one of those things you normally don’t pull out of and we were able to do it. It’s a testament to the team, the investors, to everyone who just said, “I think we can do this.” It took a lot of grit and determination, but in that 16-to-18-month period, we basically transformed the business.
During those tough months, how did you maintain the culture att 33Across?
It was incredibly hard. People have chosen to work with you and then because of the nature of the business, we had to downsize our team. It was incredibly hard. The truth was that the business wasn’t going to be there and we knew that. The first thing was just being open and honest. When you are dealing with employees in today’s age, they have full access to information. They have access to anything you say. It’s all out there and they’re so used to information and access. The most important thing you have with employees is trust. When you do something like a layoff or something like that, what’s critical is being honest with people to the best of your ability as a management team and as a CEO.
The biggest question [from employees] was, “You just laid off a bunch of my coworkers and my friends. How do I know that you’re not going do that again?” Fair question. That was the number one question. So I said to them…” When I see the revenue, you see the revenue.” One of the things they were worried about was how do we know things are OK? So out of necessity, I told employees they could see our revenue numbers. It became part of our culture. Now everybody in the company sees the revenue at 8 am and 8 pm every single day. What started out of necessity has now actually become an advantage for us. It was something we did to make sure people thought they could trust the company again…and now it’s become a tool we use to recalibrate the business every 12 hours. For example, if you’ve brought on a new partner, a new publisher who is going to use our tool…you’re going to see it reflected in the numbers. It creates a sense of pride.
What advice do you have for your fellow CEOs?
I talked about transparency with regards to revenue, but I think transparency in general is something that you need to practice from a CEO standpoint. I’ve adopted radical transparency with the board so they know that they’ll get the information very quickly from me about a situation, whether it’s good or bad. They’re getting that transparency and it may not be perfect, but they’re in that trust circle. When you have that trust, you’re able to build a back and forth with them. I learned in that process, as a CEO that they’re not getting that level of transparency often from their leaders. When you have that kind of transparency, you get to a level where you’re much further along with that board. Managing that board and building that kind of relationship with them where they know what to expect has helped me grow up as a CEO. It’s helped us get through a lot of challenges because there’s been no surprises.