Summits Yellow

Kargo shifts towards pure-play programmatic with job cuts and Sublime Skinz deal

Tim Maytom

Mobile ad firm Kargo has cut around 40 staff and will be transferring the majority of its UK workforce to Sublime Skinz as part of a pivot away from its original ad network model. The changes come as the firm tries to move away from its managed service model to pure-play programmatic buying.

According to The Drum, the lay-offs took place April and represented around 15 per cent of staff at the time. The firm has reportedly begun restaffing since then, with a focus on data scientists and software engineers to support its programmatic ambitions. The restaffing is taking place largely in the US, as the company trims back its presence elsewhere.

"It is really clear that we are moving people and resources out of the manual ad network business model, moving them toward running high-end creative, programmatically, and automating the Kargo business," said Harry Kargman, chief executive of Kargo. "The key here is we are not buying inventory on the open echange. Kargo has directly inserted our code into the pages of these publishers."

Kargo's new model will prioritise purchasing advertising from premium publishers via private marketplaces, and will also see the company partnering with Innovid to develop new ad units. Alongside this tie-up, Kargo is splitting its European operations in two, and will be transferring around 75 per cent of its London staff to Sublime Skinz. This partnership is believed to be driven by uncertainty over the consequences of GDPR, with the US-based firm hoping to limit any potential impact when the legislation comes into force.

The remainder of Kargo's London team, led by senior vice president of global operations Arthur Cole, will focus on managing the relationship between the company and Sublime Skinz.