Bizo — pronounced biz-oh, as in business — is an ad network founded in 2008 in San Francisco that caters to the business-to-business market, in which businesses target other businesses rather than individual consumers. In a press release scheduled for this morning, the company will report that December was its first profitable month.
Bizo says its revenue run-rate is now more than $5 million, a sixfold increase over a year ago. The company also says its customer base quadrupled between Q4 of 2008 and Q4 of 2009, and its number of publisher partners has increased by more than 30. In addition, Bizo completed a $6 million round of equity financing in December led by Bessemer Venture Partners, plus existing investors Venrock, Vulcan and Ascent.
“We hit the inflection point where we have enough customers, enough revenue, enough partners,” CEO Russell Glass told me in a phone call. “We should continue to see profitability.”
One important component to Bizo’s positive balance: The company has landed many of the biggest B2B advertisers as clients. At the high end of the market, the money from any one deal is a lot bigger — potentially 20 to 40 times bigger — for the same amount of work
Bizo advertisers at the upper end of B2B spending include Verizon, Sprint, HP, IBM, Microsoft, Monster, Dell, Fedex, and UPS. But the company also serves the long tail of small advertisers. “You need to do both,” Glass said.
Glass also said Bizo’s recent $6 million in funding enabled profitability rather than hindering it. “As you get bigger and bigger from a revenue persepective, you’re actually owed more and more in the short term from your customers,” he said. “You’re sort of floating a short term load to your customers.” By using the funds to build out infrastructure and pay for bigger data bills, the company was able to secure and support enough business to be profitable. Sometimes you really do have to spend money to make money.
