Founder: Omar Hamoui of AdMob
The Wisdom Of AdMob’s Founder Omar Hamoui
November 9, 2009, 10:07 PM ET
By Scott Austin / WSJ
Google Inc.’s announcement that it will buy AdMob Inc.
for $750 million brought a media spotlight on Accel Partners, an
investor in both AdMob and Playfish Inc., which said today it will sell
to Electronic Arts Inc. for at least $275 million. Several blogs, including this one, hailed Accel Partners for its impressive and quick investment returns at a time when deals like these are hard to come by.
AdMob CEO Omar Hamoui, left, converses with Vic Gundotra, vice
president of engineering at Google, at the Fortune Tech Brainstorm in
July. Hmmm, a little courting going on, perhaps?
But AdMob’s founder and CEO, Omar Hamoui,
really deserves the attention for building a company that in three
years became the largest player of mobile Web ads and
ultimately, a coveted jewel for the largest Internet company.
Jim Goetz, a partner at Sequoia Capital and the first investor in
AdMob, was quick to praise Hamoui, telling VentureWire that the
entrepreneur “has a very keen perception of mobile and a very
unconventional approach. All the things you hear today, since the
iPhone, about the independent developer – Omar identified that
community years ago.
“He kept a maniacal focus on the independent developer,” Goetz
continued. “He ignored the carriers, he ignored the ‘walled garden.’
When he started, there was no economy around mobile. It was the
inception of this market. He’s a special entrepreneur, and he built an
extraordinary business in a short time.” (It’s worth noting that
Sequoia has added a picture of Hamoui on its sparsely decorated home page as a tribute to him.)
Hamoui, 32, dropped out of the Wharton School to start up AdMob in
January 2006 in an effort to find the best platform for
bringing Internet advertising to cellphones. As the story goes, Hamoui
originally built a mobile service in 2005 called Fotochatter designed
to let people easily share their online photos with friends who can
view and comment on them through their mobile phones. But he found it
difficult to market the mobile service online, so he set out to start
another company to help advertisers do just that.
Hamoui’s first hire was Russell Buckley, now AdMob’s head of European operations, who originally reviewed Fotochatter on his blog MobHappy years ago. That blog is how the pair connected. Earlier this year in May, Buckley reminisced about that chance encounter in a blog post
and added: “Over 80 Billion ads and 3 years later, we’ve come [a long]
way since then, have over 100 employees and a valuation at least in the
hundreds of million dollar range.”
Buckley then posted a short series that shared “some of the lessons
[Hamoui] learned” while building AdMob. While we wait to hear back from
Hamoui about the Google deal (he commented on his blog here),
we found it useful to direct our entrepreneur readers to Buckley’s blog
posts which tap into the mind of Hamoui, who offers his thoughts on company launches, deals and negotiations, sales and marketing, competitive threats and communication.
As an example, and in light of the Google acquisition, here are
Hamoui’s short pieces of wisdom about deals and negotations, as written
by Buckley who adds his comments:
Understand what you really have to lose (which is usually not much)
If you are a person with a laptop
and an idea, don’t worry about messing up the 100m dollar business you
think you will someday be.
Russell adds: It’s hard to emphasise
how important this is. In reality, most people have very little real
downside to having a go and even if the idea doesn’t work out (and most
don’t let’s remember) you’ll still learn a ton, which will add
considerably to your value in business.
I’d also add, on a related note,
that far too many entrepreneurs get paranoid about protecting their
idea to the point of paralysis. The value of most ideas is in the
execution, not in what the concept actually is. To make it reality, you
need to share it – actually, with as many people as possible,
counter-intuitive though this might seem. And in my view, forget about
NDAs and the like. They’re pretty useless all round as far as I’m
concerned, but for one man and a laptop, a total waste of time and
effort, which at best just create speed breakers for your idea.
Leave something on the table
If your partner feels as good as you walking away from the table, you are much more likely to have a successful relationship
Russell adds: This is so important.
Many self-proclaimed “great deal makers” focus too much on getting the
best for themselves and wonder why the relationship falls apart or
never achieves its potential.
Wait until the rubber hits the road to evaluate a deal
Don’t get too excited until the results actualize. Most deals are not as good as they look on paper
Russell adds: Oh yes. If I had a penny….etc
It’s also worth remembering that
many of the best deals come from existing relationships with partners
or customers. This isn’t as sexy as hunting down the big mammoth
stomping around in the jungle, but effective account management is a
skill you ignore at your peril and every company could improve this
aspect of their operation.
The Google offer no doubt looked good on paper. Hamoui will be
staying on with AdMob and Google for now, but you can bet once he’s
ready to move on to start another company, venture capitalists will be
lining up to invest.
If you want to hear more from Hamoui, below is a one-year-old,
half-hour interview by Robert Scoble who around the two-minute mark
gets Hamoui to talk about his negotiations with venture investors,
including Sequoia Capital, which invested in the company in
2006. Hamoui said he was introduced to Sequoia after he didn’t like a
term sheet from another venture firm. On a Thursday night, he flew out
to meet Sequoia, even though he had until Friday to decide whether to
accept the other firm’s offer. Within 24 hours, Sequoia offered Hamoui
a competing term sheet and he signed it two minutes before the other
offer’s deadline. Sequoia’s partners deserve credit for seeing
something in Hamoui, who was the only employee of the company.
“I had to do the pitch [to Sequoia] like four or five times,” he
tells Scoble, “because it has to be a unanimous decision. Every partner
has to see it, and every partner has to vote yes otherwise they won’t
do it….The overall market opportunity is extremely substantial. And
they tend to be market investors, so they’re whole theory is that if
the market is spectacular, even a sub-optimal product with a
sub-optimal team will do fantastically well. Not that, hopefully, we