The next Google: LeadBolt dominates app advertising, serving five billion ads a month in 100 different countries. Now, Microsoft has come knocking

Found: the next Google

July 19, 2013

Christopher Niesche


LeadBolt dominates app advertising, serving five billion ads a month in 100 different countries. Now, Microsoft has come knocking.

Andrew Scarborough is driving LeadBolt’s domination of the global market for app ads. Google might rule the massive online advertising market at the moment. But Australian company LeadBolt is hot on its heels and starting to dominate the fast-growing app advertising market. The business is a mobile advertising network that runs a platform that allows advertisers to put ads into free mobile phone apps. The advertising revenue goes to the app developers with LeadBolt taking a commission along the way. This year, smart phone users around the world will download 80 billion (yes, billion) apps, and that number is forecast to double to 160 billion by 2017.“There are so many customers we’re not really competing with our competitors in a way, we’re just trying to fulfil that increasing demand,” says co-founder and chief technology officer Andrew Scarborough. “At some point it will settle down, then that whole thing about competitive edge will kick in where we’ll have to be even more super smart with what we do.”

Most ads pay only a small fraction of a cent, but this adds up. The company serves up 5 billion ads a month in 100 different countries and advertises on 40,000 apps.

The inspiration for the business – which was founded in 2010 and now employs more than 50 staff in Australia and the US – came from one of the founders, Dale Carr, who noticed the rise of the smart phone and saw that what little mobile advertising there was wasn’t really working.

“Then you put the two together and if you can make it work you’ve got a big global market and that’s where we started our journey,” says Scarborough.

But there were technical problems to overcome before the business could get up and running. With no platform (or program) available to do the job, Scarborough had to build one from scratch.

It also had to find more innovative ways of using the smaller mobile screen, including audio ads that allow people to keep using the app and shake their phone if they’re interested. Another approach is to run ads in the same way that TV ads appear, such as at the end of a game level on an app so it doesn’t interrupt the game.

Next, they had to attract customers. The advertisers were easy enough to find, but a lot of app developers work independently, sometimes from home in different countries, and were much harder to contact. Leadbolt’s solution was to get in touch with them via online technical forums and trade shows until word of mouth spread about what they were offering. They also offered incentives to developers to refer their friends and colleagues.

Nine out of 10 apps downloaded are free, meaning the app developers are hungry for revenue. Some app developers can make thousands of dollars in advertising revenue a week, but most make a lot less.

LeadBolt (the first syllable is pronounced as in lead generation, not the heavy metal) effectively has two sets of customers – advertisers and app developers – and this has helped fuel the company’s growth (revenues grew 300 per cent in 2012). “We end up with this bootstrapping,” explains Scarborough. “Suddenly we’ve got a lot of developers and we need to fill all their advertisements so we’ll work on the advertisers’ side and then we’ve got too many advertisers and we get more developers.”

As LeadBolt has grown and gained credibility it’s been able to attract major advertisers, including Disney, Webjet and Domino’s.

As a company in a fast-moving technological space, LeadBolt has a mantra of constantly innovating.

“We have to wake up every day and say ‘what are we doing new today?’, and if we’re not asking that question after two or three days that’s a problem,” says Scarborough. “When we’ve slowed down and we’ve been talking about something, a competitor will suddenly release that feature.”

LeadBolt was recently approached by Microsoft, which is making a push into the mobile space, and asked the company to launch on its new operating system Windows 8. “That’s been very exciting getting that going,” he says. It was also a recent finalist in the 2013 Telstra Business Awards.

LeadBolt is the only Australian company offering mobile ads, but it has about 50 competitors globally. It is the third-most-used advertising platform by app developers on the Android system (the easiest to measure usage), with Google at No. 1.

“For me, knowing that I’ve come on board and we’ve built the technology from the ground up, that’s quite satisfying,” says Scarborough. “Of course, I’d like to beat Google. That would be fantastic.”

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (, the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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