FBX Partner Rocket Fuel Rakes in $107 Million in 2012

Demand-side platform close to breaking even, says CEO

Ad tech outfits tend to keep quiet on how their business is doing, unless business is doing particularly well. Criteo, BlueKai and Triggit have previously publicized their bottom lines. Demand-side platform Rocket Fuel is another in that club, and it's just released some new impressive reveneue figures.

The Redwood City, Calif.-based company generated $107 million in revenue in 2012, up 238 percent from the previous year. Rocket Fuel CEO George John said the company wasn’t profitable last year but is “very close” to breaking even. Hiring is part of the reason the DSP—which raised a $50 million funding round last summer—isn’t in the black, John said. Rocket Fuel increased its staff by 126 percent last year to 289 employees and opened six new offices. 

Depending on exactly how close to profitability Rocket Fuel is, the company could cross into the black fairly soon, assuming it experiences a revenue boost similar to those enjoyed by other Facebook Exchange partners (Facebook Exchanges lets advertisers retarget its users based on their non-Facebook Web activities; it's been a great success to date). Rocket Fuel didn’t run its first FBX campaign until Q4 and didn’t roll out FBX capabilities to clients at scale until the middle of the quarter, John said, so that business didn’t have a signficant impact on the company’s 2012 numbers.

Instead Rocket Fuel was buoyed by the fact that it retained 93 to 94 percent of its customers from month to month throughout the year and churns through 26.2 billion real-time biddable display impressions daily. “Eight-four percent of our revenue came from customers on their second quarter or more with us,” John said. Rocket Fuel was unable to provide average campaign performance stats its advertisers see, but John pointed to a couple individual case studies, including one for airline Lufthansa that saw a 50 percent lower cost per acquisition and an 11 percent higher conversion rate.

Given Rocket Fuel’s numbers and unending speculation over ad tech consolidation, the company is likely a ripe acquisition target. Former DoubleClick and AppNexus exec Ari Paparo, now with BazaarVoice, recently included Rocket Fuel on a list of ad tech companies most likely to be bought in 2013. “I can’t comment on that much,” John said, when asked of acquisition possibilities.