Founders’ exodus led to Millennial Media sale: report

AOL’s acquisition of Millennial Media was touted as a way to bolster AOL’s adtech capabilities. But for Millennial Media, the reports have started flowing in questioning how a once-sizzling startup valued at nearly $2 billion could ultimately end up being sold for about $240 million.
Forbes’ Alex Conrad led the way, writing that Millennial in 2015 is “the body of what was once a fast-running race car to be stripped for parts.” The headline on the story read “AOL Mercy Kills Millennial Media.”
Writing in Huffington Post, Rob Emrich chose a “eulogy.” “This day marks the end — the death — of the mobile ad network,” he wrote.
While those reports were clear with their language, they didn’t apportion blame. But Business Insider’s Jim Edwards has a report quoting sources that are willing to name names, even if the sources themselves are anonymous.
Edwards’ report points to the company’s initial group of leaders, many of whom left in the years following the company’s IPO.
“In short, the founding team disappeared after the IPO. The top leaders responsible for the strategy, tech, sales, and marketing that got the company to the stage where it could go public simply aren’t there anymore,” he writes.
The sources pointed Edwards to cofounders Paul Palmieri and Chris Brandenburg, as well as CFO Michael Avon. All three remain in Baltimore as investors. Palmieri, who left Millennial in 2014, is a venture advisor with Timonium-based VC giant NEA, and Avon just joined downtown Baltimore firm ABS Capital. Brandenburg has also been an active investor with companies like OrderUp, which was recently acquired by Groupon.
Edwards also found an SEC disclosure that said current CEO Michael Barrett stood to benefit from selling the company with a package of salary and stock that was worth about $10 million.
Of course, the sale and lost value for shareholders doesn’t necessarily mean that Millennial Media won’t have success as a part of AOL going forward. The company trotted out reports of losses to investors for many quarters in a row, and Barrett has acknowledged that it was hard to compete after big tech players like Google and Facebook got into the adtech game.
“If you’re really competing against Google, Facebook and Apple, this allows you to look yourself in the mirror and say, ‘Game on,’” Barrett told the Baltimore Business Journal this week.
With AOL having just been acquired by Verizon for $4.4 billion, Millennial is now part of a company that has that reach.
What the deal means for Baltimore, however, is still an open question.
AOL has said its wants to continue to grow its adtech presence out of the Baltimore office that grew following its acquisition of Advertising.com.
But with the acquisition deal not expected to close until later this fall, questions still remain about whether there will be layoffs or changes to the company’s existing Canton offices as the two companies merge.