Spot Runner Firing People, Reorganizing Ranks

Michael Learmonth | August 13, 2008 10:06 AM

nickgrouf.jpgSpot Runner is laying off a bunch of people: 100 total if you believe a Valleywag tipster; much less if you believe a company spokesperson, who says the company is only canning 50 people. That smaller number is about 10% of the startup's workforce.

The company, which raised $111 million from the likes of CBS, WPP and Lachlan Murdoch, tells NewTeeVee the staff changes are part of a "course correct" to re-focus on national advertising, and that it will hire another 40 to 50 people to beef up its national sales force, headed by former MSN sales chief Joanne Bradford.

What seems clear: Spot Runner, which started by focusing on helping mom-and-pop businesses cheaply create and buy local TV ads, is shifting away from that emphasis to a national ad strategy. Local ads have been hit hardest during the ad downturn, which probably explains the shift.

UPDATE: A Spot Runner spokesperson says the new employees haven't yet been hired, so company headcount is 10% lower since the layoffs began. Also, the company says it's not pulling away from the local ad market, just adding two other units, one for national and another for online advertising. In other words, Spot Runner is sounding more and more like an ad agency.

See Also:
Spot Runner Enters Local Political Race
Bradford: Why I Left MSN For Spot Runner
Will WPP Buy SpotRunner?

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19 Comments

stone said:
I've been saying for some time now that something isn't right with this company. Eventually, reality hits hard and this is what happens. I doubt that this company will ever succeed.
insider said:
navic networks sold for $200MM, and had real partners, real customers, real revenue, real profits, real technology

having raised $111MM and with nominal revenue and massive negative cash flows, spot runner is (and has always been) a money suck in search of a reason to exist

dead pool.
Definitely seems thin margin, mile wide, inch deep. Folks I've spoken to insist it's doing well, but mass layoffs usually not a good sign.
pasan said:
This has to be a devastating day for their CEO, Nick Grouf. He seems to talk a good game, sort of, but doesn't seem to be able to deliver the goods. The employee morale must be incredibly low. Yikes!
Puzzled said:
Hey Nick, the emperor looks pretty naked to me. What am I missin here? Strategic Re-Focus - Oh, OK. How about you stop pissing away money and start building value. Didn't you learn anything from the bust? You make any more missteps and even WPP won't be interested in bailing you out. Again.
Vanilla Chin said:
I think reports of SpotRunner's death are greatly exaggerated. Nick is a smart, capable CEO with a GREAT product and a TON of cash.

Any intelligent person running an advertising start-up in today's conditions is going to look at the current situation and figure out how to conserve cash to make it through the next year's advertising recession.

That doesn't mean the company is failing. In fact, I think it means quite the opposite.

jenkins said:
@Vanilla Chin,

My guess is that you're either a friend or employee. Why is it that Spotrunner appears to be abandoning their TV ad business and adding to the SEM business? Who goes into the SEM business in 2008? It just doesn't make a whole lot of sense. If they have such a great product and such a great CEO then they wouldn't be re-structuring and firing a boatload of people because they wouldn't have gotten out of balance in the first place. We've ALL seen this downturn coming for the last 12 months. Give me a break --- Nick is failing! Smells like PeoplePC all over again.
Man Cow said:
I agree with Puzzled and Jenkins above. Nick got into an area already well represented by Cheap TV Spots and though he may have tried to copy their model, dressing it up a bit for tech investors and the naive small businessperson, he could not copy the CheapTVSpots quality and no-additional-commissions or fees for air time policy. Spotrunner may not die, but may slowly wither on the vine like Nick's People PC. Where is due diligence!
mark (URL) said:
This company has no reason to exist. Believe me, I know. I work here. If our investors ever took a look around before 10am or after 5pm or on a Monday or a Friday, they'd start crying about how much of their money is wasted. And clients are starting to realize that if we don't charge them what we should be for creative, we're raping them in another way -- by marking up their media.

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yuhcn3b said:
Firing people is hard to do but it has to be done. SOmetimes a Free MMO shuts down and the whole player base is basically fired!
nigella (URL) said:
Spot Runner Firing People, Reorganizing Ranks70-631That's rubbish! It's no like that at all. That's rubbish. Treat it with respect.Have respect for someone.
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Baseball Bats For Sale (URL) said:
Isn't it interesting that a company that starts of with a unique perspective and strategy ends up looking like more of the same. I think this happens because companies try to grow too fast to impress investors and find themselves growing faster than the little niche market can handle. So, the turn to old tried and true strategies. innovation right out the door.

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JohnShanksx said:
Meh some people need to get fired for a business to survive. It's called reorganization. MMORPG News

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