Online ad marketplace AdExchange is down to a dozen employees and is in discussions with investors about how to proceed with its business, Internet Advertising Report has learned.
The company’s chief executive Paul Grand confirmed that the company has cut an additional 10 employees, bringing the total number down to about 12. That latest number comes after a series of cuts that reduced its workforce from 53.
Grand said portions of those cuts came after AdExchange completed its online ad transaction system several weeks ago.
“We reduced our staff pretty dramatically … following the completion of our platform,” Grand said. “We trimmed down a little bit then because we had a bunch of developers here we didn’t need. But the market is very different now. We’re looking at our future and making more reductions”
A skeleton crew will stay at the company “to continue development and operations, basically,” Grand said.
At the time of AdExchange’s launch in April, the company said it intended to oversee the buying and selling of online media, eventually expanding into television, print, radio, and outdoor advertising. Now that plan seems to be in jeopardy.
“We’re talking about options with investors and deciding really what it is we want to do, and what they want to fund, and best direction for the company, and for the technology,” said Grand. “We’re evaluating what the best direction is for us to go … and it’s primarily driven by our investors, and what they want to fund.”
AdExchange’s investors include high-profile firms including Palomar Ventures and idealab Capital Partners, a unit of Internet incubator idealab!. Together, the two firms have put about $5 million into AdExchange thus far.
The Beverly Hills, Calif.-based firm has been under intense competition since its launch. Others players in the B2B media exchange arena include AdOutlet.com and Media Market Makers, the latter of which is partially funded by the Interpublic Group of companies. In May, another competitor, One Media Place, secured a $67 million round of financing from Internet holding company CMGI, cable services provider Liberty Media and trade magazine publisher Primedia.
Grand maintained that his company might be down, but it isn’t out. Its remaining staff is still continuing sales and business development, and the company’s chief said he was optimistic.
“We’ve got a great product, great tech, and customers love it,” said Grand. “But it’s all about what the investors are willing to fund. That’s the reality for everybody in this market.”
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