Brad Flora, known in Chicago as the founder of media site Windy Citizen, has failed, pivoted and moved to Silicon Valley.
And this week, he sold his latest company, NowSpots Inc., the creator of Perfect Audience, for $25.5 million.
“This is the first time when the end of the road wasn’t me turning off the servers,” said Flora, who shuttered Windy Citizen in 2012. “It feels great.”
Flora came to the Chicago area in 2006 to pursue a graduate degree that would propel him into media entrepreneurship with Windy Citizen and other projects that made their mark but eventually failed.
In May 2011, Flora and his co-founder at the time moved to Mountain View, Calif., to participate in Y Combinator’s summer program. That fall, they raised a seed round for their product NowSpots, which created rich-media ads, but they also realized the market was smaller than anticipated.
Flora said that led to him parting ways with his co-founder. When he returned to Chicago with $1 million in the bank, he said, he looked for a developer partner but couldn’t find one.
“I tried to build the company 100% in Chicago and failed,” Flora said in an email. “I just couldn’t convince any developers in Chicago to join. And a software company without developers isn’t much of a software company.”
He returned to the Valley and hooked up with Jordan Buller, a developer who became NowSpots’ CTO in April 2012. By January 2013, company headquarters had moved to San Francisco.
When he realized the market didn’t exist to scale NowSpots into a major product, Flora pivoted from helping companies create advertisements to helping deliver them.
The result was Perfect Audience, a retargeting tool that uses cookies to track visitors, then serve them customers’ banner ads on Facebook and other sites in the Perfect Audience Network. That product, released in October 2012, led San Francisco-based public advertising tech firm Marin Software to purchase NowSpots Inc. in a deal announced Tuesday.
Employees will split up $2.7 million in restricted shares, while the remaining $22.8 million will be paid out according to NowSpots’ cap table. Approximately $5.4 million will be paid in cash, with the remainder in stock.
NowSpots’ investors include Chicago-based New World Ventures and the John S. and James L. Knight Foundation, as well as Y Combinator, SV Angel, WGI Group and Start Fund.
The company’s 14 employees span its headquarters in San Francisco, an office in Chicago and remote working in Raleigh, N.C. Flora said the employees will all join Marin’s workspaces in the cities where they already live.
Flora will lead a new display and programmatic advertising team at Marin as head of product, while Buller will be director of technology for that same team.
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The Perfect Audience product will retain its name and continue to function as a standalone offering for the time being, Flora said. New engineers and support workers will be hired to further develop Perfect Audience and explore future integrations with Marin’s social and search advertising products.
“This is just an opportunity for us to keep doing what we’re doing, expand the team and also go upmarket and start working with larger brands,” he said.
Perfect Audience’s sweet spot was small and medium-sized businesses, but Flora said developing the tool to work better for big companies was also part of the plan.
Flora said marketers often complain about the number of dashboards they have to log into daily. By offering search, social and display advertising services in one place, Flora said he hopes to ease that frustration while driving customers from Perfect Audience’s platform to Marin’s, and vice versa.
Beyond that, Marin and Perfect Audience will soon be able to share data. That means they will be able to use the information the other holds to serve and retarget more and different types of ads.
Rich Gordon, director of digital innovation at Northwestern University’s Medill School of Journalism, said Flora took his Innovation Products class. He said Flora was driven by his experience when Windy Citizen was in its heyday to explore ways to innovate in online advertising.
“He is always bubbling over with ideas and very driven to make those ideas into something that could be a business,” Gordon said.