I first met Richard Rosenblatt, the co-founder and CEO of a now very public new media company, back in 2006, after he had successfully sold MySpace to News Corp’s Rupert Murdoch and had just started a long-tail phenomenon called Demand Media.  I had asked him to participate in an Internet forum I was hosting at USC.  People at that event were clearly watching and listening carefully to this serial entrepreneur because he is that rare person who not only envisions a business, but an entire industry, and then makes it happen. If you're familiar with his history, he has done it multiple times, but that’s another story. He became a friend (and, of course, he's a fellow Trojan), and last week I had the good fortune and excitement of being an investor in the company’s highly successful IPO on the New York Stock Exchange.  In the short space of about 4.5 years, Demand Media (DMD) has grown to more than 600 employees with locations in North America and Europe and is now worth as much or more than the New York Times on the public market. 

In content and media, Demand Media exploits both the demand and the supply side of the equation when it comes to economic efficiencies.  It creates content based on demand from the market (answering everything you ever wanted to know about anything), which it determines through a proprietary algorithm that tells the company what people are searching for on the Internet.  On the supply side, the content business, which is arguably the largest on the Internet, takes advantage of the millions of “experts” who write well and are looking for additional opportunities to create an online presence.  Demand boasts of more than 10,000 freelance content creators who get paid to produce a daily average of 5,700 text articles and videos.  All of those articles are edited prior to publication—no off-the-cuff user-generated stuff here despite what you might hear on some of the blogs.

Demand Media also owns enterprise-class social media applications that bring user profiles, comments, forums, review, blogs, and photo/video sharing to websites within the Demand Media portfolio and to the more than 375 websites owned by customers such as USATODAY.com and the National Football League (NFL.com).  The company has been granted five U.S. patents with 19 applications pending.

But back to Rosenblatt.  He's definitely the face and soul of this company, but he's also very smart.  Recently he hired Yahoo’s head of branded sales, Joanne Bradford, to grow their premium advertising and content, and then there's  CIO Byron Reese, who has been the brains behind the company’s proprietary and powerful algorithm. Many are confident that Demand Media is poised to grow a lot bigger. Recently, Facebook’s chief operating officer, Sheryl Sandberg, said, “They really understand consumer behavior on the Web and how to build businesses on it.”  No doubt about that!

An exciting company always generates some controversy and bloggers from Bloomberg to Business Insider are doing their share of naysaying.  But Rosenblatt has heard it all before and it’s not going to stop him.  Once the quiet period has ended next month, he’ll finally get to respond to all the speculation. Acquisition has been a growth strategy all along, and now that Demand Media has some liquidity, the public markets to play in, and a market cap of $1.5 billion, the company is definitely a force to be reckoned with.