Commentary

Real-Time With TheStreet's DeMarse, AppNexus' First Woman Board Member

AppNexus, a large independent ad tech firm that sits as close to the “middle” of the ad tech ecosystem as any other, on Thursday announced the addition of Elisabeth DeMarse to its board of directors. DeMarse is chairman and CEO of TheStreet.

Real-Time Daily caught up with DeMarse to pick her brain on the programmatic ad industry and to find out why she’s working with AppNexus -- a private company -- when she has a sort of personal code to only sit on the board of public companies.

Real-Time Daily: Does this change anything you’re doing at TheStreet?

Elisabeth DeMarse: Not at all. I have a history of serving on -- most public company -- boards, and I find it very additive to my work as a CEO because I’m in the digital tech and digital media space.

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When I sit on boards, like the other nine Internet boards that I’ve sat on, it’s very helpful because you learn so much about what’s going on in our industry from a different perspective.

RTMD: Why work with AppNexus?

DeMarse: AppNexus is in the middle of the supply and demand for advertising and that’s so critical to publishers. To work with someone as great as [CEO and Co-Founder] Brian O’Kelley, and to take advantage of everything he sees is fantastic.

RTMD: Does TheStreet work with AppNexus?

DeMarse: We are a Google DoubleClick client. We have relationships with them in terms of distributing our video, we are applying to be a part of their new initiative to be a part of Google video, [getting a] Google certification, etc. It’s easier to deal with one party.

Having said that, what’s really important about AppNexus is their independence. It’s bad to become overly dependent on Google. We’ll see if it comes to fruition down the road -- if it’s a switch we want to make.

RTMD: AdExchanger recently reported that 30-40% of the inventory on AppNexus is unable to be verified, and O’Kelley laid out some of the company’s plans to combat the fraud to try to shrink that number. Are you on board with those plans?

DeMarse: Absolutely. Brian, first of all, is a technologist. That’s so important; he’s keenly aware of the tech side. 

Syncing up the demand and supply sides is very tricky -- there’s an art to it -- and he’s completely on top of this.

RTMD: How familiar are you with programmatic trading? How long have you been engaged with the tech?

DeMarse: In October 2012, when we were planning and budgeting for 2013, some large advertisers came to us saying they will only buy programmatically, not directly.

So we hired the best guy in programmatic we could get -- Patrick Dignan (from Forbes) -- and he’s been running our ad sales and programmatic stack here. So I think the horse is out of the barn -- it’s just a reality for all publishers. [But] we do need the direct sales at the top of the stack to come in and compete to raise the CPMs.

Large advertisers are saying: ‘We are only going to deal programmatically,’ --that’s the future. I think the winner ends up being contextual versus behavioral targeting.

RTMD: What are some of your goals coming to AppNexus?

DeMarse: Brian and I share a love for media and a love for publishing, and we’re facing a high velocity of change. Brian is very, very dedicated to seeing quality publishers get the highest value for their inventory and for their audience -- so we’re both huge advocates of that, and that’s been our strategy at TheStreet, and a strategy that has succeeded. The world is now getting terrific, wonderful and rich free content, we just have to make sure its supported with revenue.

I think the second thing is -- just as a public company CEO -- it’s always nice to have an operator to talk to. I’ve seen a lot in terms of finance and HR infrastructure, and I hope to be valuable in that dimension as well, if Brian’s willing.

And finally, I am very passionate about gender diversity. I do think it’s fairly shocking that we’re at this stage in 2014 and there is so little representation on tech company boards -- and I do consider AppNexus a tech company -- in terms of gender diversity. And even in [tech company] employee bases.

I spend a lot of time in California, and typically I’m the only women on the boards I’ve served on. They’ve been exciting companies and I’ve loved being a part of them, but I wish all companies -- particularly in the tech space -- would devote some resources toward making sure they have gender diversity, not just on boards, but in employee bases.

RTMD: Are you the first woman on the board of AppNexus?

DeMarse: Yes. [Board members include: Brian O'Kelley, CEO of AppNexus; Michael Rubenstein, president of AppNexus;Mike Tyrrell, Venrock; David Yuan, Technology Crossover Ventures; Dave O'Hara, Microsoft; Chip Meakem, Tribeca Venture Capital; Elisabeth DeMarse, TheStreet.com; and Edwin Gills.]

RTMD: You’ve been a board member on ZipRealty, All Star Directories, Internet Patents Corporation, InsWeb, and EDGAR Online. Which companies are you still on the board of?

DeMarse: We’ve sold them all. All star and Zip both sold this summer. AppNexus is the first board I’ve had in New York in a few years -- and that’s nice. 

That’s another thing I love about Brian and AppNexus and what he’s trying to do. We are a bit behind in New York from venture capital -- it has barely taken over in Boston. I think that’s something Brian cares deeply about

We don’t understand it -- because we don’t like to think New York as behind on any dimension -- but there’s more going on in LA in New York in terms of investor capital and cool tech. We have our head in the sand a little bit, and Brian is facing it head-on.

I’m thrilled to join a board based in New York, because, frankly, it’s unusual.

RTMD: We mentioned fraud earlier, but what other hurdles need to be cleared in the programmatic space? It’s been growing rapidly, but what needs to happen to continue to support that growth?

DeMarse: You’re absolutely right about the fraud. I’d [also] like to see improvement in attribution analysis.

It’s not just programmatic [growing on its own] -- it’s also a shift to mobile. It’s really a one-two punch for publishers: They can’t really have their heads in the sand on this.

I think that mobile is still such a free for all -- the saying is “offline dollars to digital dimes to mobile pennies.” It’s almost impossible to make money off of mobile. We’re going to see programmatic mobile. In the course of two years [mobile has] gone from 20% to 40% and its going to be 50% soon.

[There’s also native], which works really well for a lot of categories, including luxury and travel and that kind of thing. In [TheStreet’s] space, which is financial, the financial publishers are extremely conservative and will be slower coming to native.

But it will be a combination of all of these things [mobile, programmatic, native]. I think you have to play every angle, and things are moving very quickly and you can’t be flat-footed. You have to adapt.

RTMD: You said you usually only sit on public boards, but AppNexus is private. Should we read into this and think an IPO is coming?

DeMarse: I defer to Brian and shareholders on that kind of thing.

I do not sit on private company boards -- this is a very unusual thing for me to do. Part of it has to do with Brian is an incredible leader. I’m excited about his vision for expanding digital media in New York.

[But it also has to do with] the fact it’s such a large private company. AppNexus has got infrastructure, fantastic legal advice, etc. I have run private companies, and I always run them as if they were public in terms of infrastructure -- [so] it was very much about the infrastructure at AppNexus.

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