When AppLovin Corp co-founder Adam Foroughi pitched his fledgling ad-tech business to Bay Area venture capital firms more than a decade ago, he was rejected by every one. He got the last laugh.
Shares of Palo Alto, California-based AppLovin have surged seven-fold this year, giving Foroughi a net worth of $10.9 billion and vaulting him into the ranks of the world’s 500 richest people at number 251, according to the Bloomberg Billionaires Index.
Foroughi still owns about 10 per cent of AppLovin, which provides marketing services to mobile app developers. The company’s stock price surged 46 per cent on Thursday after reporting third-quarter results that shattered estimates, while touting its AI-powered advertising engine. The shares closed at $290.01 Friday in New York for a total market valuation of $102.6 billion.
“AppLovin continues to impress,” Wedbush Securities’ Michael Pachter said on Thursday in a note to investors, reiterating its outperform rating. “We see little downside to the stock at current levels.”
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A spokesperson for AppLovin didn’t respond to a request for comment.
Born in Tehran in the wake of the 1979 Iranian revolution, Foroughi moved to the US as a child and graduated with a business degree from the University of California at Berkeley in 2001. After starting out as a derivatives trader, he co-founded two ad-tech start-ups before launching AppLovin in 2012.
It has since carved a niche in the crowded digital-advertising market, where it competes with heavyweights such as Alphabet Inc. and Meta Platforms Inc. It reaches 1.4 billion daily active users by focusing on mobile games, developing interactive ads and crafting marketing strategies to help clients attract smartphone users.
In an earnings call on Wednesday, Foroughi said the company was on target to achieve up to 30 per cent annual growth, driven in part by its AI-driven Axon 2.0 advertising engine. The company reported profit and revenue that exceeded analysts’ estimates and emphasised its growing focus on e-commerce.
After those VCs turned him down 13 years ago, Foroughi bootstrapped the business, self-funding and relying on angel investments. In 2018, AppLovin tapped the leveraged loan market for $280 million, allowing Foroughi to grow AppLovin while retaining his stake.
“It just made sense for us to raise capital in this manner versus sell off shares and dilute,” Foroughi said in an interview after the debt raise.
Foroughi earlier came close to ceding control of his company — named in part for Christopher Mintz’ role in the 2007 teen classic Superbad. AppLovin announced a $1.4-billion sale to Shanghai-based Orient Hontai Capital in 2016, but the deal was restructured to a minority debt investment a year later after federal officials raised concerns about a Chinese entity having ownership.
“This fully restructured agreement permits us to maintain full control of our business, while accessing additional liquidity to finance our continued global growth,” Foroughi told Reuters at the time.
AppLovin debuted on the Nasdaq exchange in a 2021 initial public offering. Foroughi’s 10 per cent stake in the company today makes up 99% of his net worth, with the balance mostly cash, according to Bloomberg’s wealth index.
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