- Analytics firm Jumpshot shut down last week after a report alleging that it was selling people's browsing data without their knowledge to marketers like Home Depot and Revlon.
- Former employees and marketers said Jumpshot's parent company Avast, a cybersecurity firm, worried that the report could hurt its business.
- Avast and Jumpshot have said its data is anonymous and does not reveal personally identifiable information.
- Its shutdown comes amid growing measures to protect consumer privacy.
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Just a month ago, 5-year-old Jumpshot looked like a company on the move. Ascential, the holding company behind giant advertising conference Cannes Lions and well-connected media and ad consulting firm MediaLink, had recently acquired 35% of the startup and was introducing it to clients at the Consumer Electronics Show in Las Vegas.
Jumpshot promised advertisers unparalleled access to granular data within Amazon and Google, and the Ascential relationship had the potential to supercharge the business.
Then last week, Jumpshot suddenly shut down, laying off about 250 employees. Ascential sold its stake back to Avast. At the time of the acquisition, Jumpshot was valued at $177 million.
The firm had just been the subject of an investigation by Vice and PCMag alleging that Avast, a Czech company that makes cybersecurity software and acquired Jumpshot in 2013, was collecting and selling people's web browsing data without their knowledge. According to the investigation, big companies like Pepsi, Home Depot, Microsoft, and McKinsey paid Jumpshot for this data.
Vice and PCMag said it contacted more than two dozen of Jumpshot's clients and got "only a handful" of responses. Two, Home Depot and Yelp, responded that they used anonymized data from Jumpshot, according to the article. Jumpshot and Avast have claimed the data was anonymized.
Dozens of other media outlets like Forbes, Fox Business and The Verge picked up the story. Avast's stock plummeted, losing roughly £1.1 billion ($1.45 billion) of its £5.1 billion ($6.7 billion) value, The Financial Times reported.
Now, Jumpshot's website is wiped except for a message that reads, "Jumpshot has ceased operations. Thank you."
Jumpshot CEO Deren Baker did not respond to Business Insider's request for comment. An Avast spokesperson pushed back on the idea that Jumpshot was shut down in response to the article.
"We started making changes in July to how data was collected and processed through an explicit opt-in request, and by divesting 35% ownership, prior to significant media coverage on the topic," the spokesperson emailed. "Despite these and subsequent changes, we came to the conclusion that providing marketing insights was not in line with our privacy priorities as a company in 2020 and beyond."
Representatives for Ascential declined to comment for this story.
Consumer privacy has become a hot-button issue
Jumpshot's shutdown comes amid growing consumer privacy concerns that have led to laws like California's Consumer Privacy Act that are clamping down on marketers' ability to collect and sell people's online data.
Business Insider spoke to three former employees who said the article, coupled with a recent change to Google's Chrome browser, made Avast's execs and board nervous that users' privacy was at risk. The former employees' identities are known to Business Insider but they requested anonymity because their severance packages are still being worked out.
Separately, a marketer and an agency familiar with Jumpshot's pitch said their offering was expensive and that it was hard to understand all the data.
Jumpshot pitched itself as a way around the walled gardens
Jumpshot has long pitched its data to advertisers and journalists as a way to get data from walled gardens like Amazon, Netflix, and Google.
It pulled data from 100 million devices and 5 billion daily actions to help marketers understand which sites people visited before buying products or watching content. The firm also sold data and research to brands about their competitors' online sales.
Two former employees confirmed that Jumpshot didn't identify personal information. One said Jumpshot turned down contracts from marketers that wanted such data.
"It was all about understanding what groups of consumers tend to do - not tracking an individual and targeting them with an ad at the right moment," said another former employee.
Nike was one of Jumpshot's biggest examples of how it pitched data to marketers. In November, Nike said that it would stop selling its products on Amazon to focus on selling direct to consumers. Jumpshot used the Nike example to show the kind of data it could sell other marketers that were making similar moves. That pitch would have aligned with Ascential's Amazon-focused agency FlyWheel Digital.
Data provided from Jumpshot to journalists at the time showed how Nike's sales broke down between marketplaces like Amazon and its own website. It is unclear if Nike was a Jumpshot client; Nike did not respond to a request for comment from Business Insider.
Jumpshot depended on Avast's data to keep the lights on
Jumpshot drew negative attention last fall when popular adblocking software Adblock Plus founder Wladimir Palan published a blog post claiming that Avast's browser was collecting people's browsing behavior without their knowledge, saying users were "being spied upon." In December, Firefox, Mozilla and Google temporarily removed Avast's browser extensions from their app stores over the same data-collection processes.
Jumpshot's closest competitor was SimilarWeb, which also helps marketers track data across websites. Unlike other firms that pull data from third parties, Jumpshot got data exclusively from consumers who had downloaded Avast's products. After Google's move, employees said they were concerned that if Avast pulled the plug, Jumpshot would lose all of its access to data. Google also clamped down on a rule barring Avast from sharing its browser extension data with third parties, including Jumpshot.
According to one former employee, Jumpshot worked through the holidays to find a new way to collect data outside of browser extensions.
Avast got hit by a storm of negative press
Two days after the Vice and PCMag article published, Avast's board and leadership met to determine Jumpshot's fate, according to one former employee.
The next day, Jumpshot executives told employees at an all-hands meeting that the company was being shut down. Two former employees said the meeting was emotional. Employees wore Jumpshot-branded T-shirts to work on Thursday to honor the startup.
"We've had such a tight-knit group and so much fun," a former employee said. "I couldn't be prouder about what we built."
Some employees said they weren't surprised by the Vice and PCMag report but by how quickly Avast reacted.
"I always knew that someday somebody was going to write the story of, 'cybersecurity companies are selling your data' - that's such an intriguing hook," said a former employee. "Even those of us who knew that was going to happen one day didn't compute that three days later the company would be out of business."
Was Jumpshot selling the 'holy grail' of consumer data?
One agency exec familiar with Jumpshot's pitch said that at a time when platforms were limiting marketers' access to user data, Jumpshot had a seemingly appealing pitch.
"In the search landscape, more and more often data that Google used to supply to us is either pulled back or obfuscated," the source said. "The promise that Jumpshot was giving us a view into that without exposing personal identifiers was like a holy grail."
But like with other adtech and martech companies, it was hard to understand how to use and apply the learnings from Jumpshot's dashboard, said the agency exec.
The exec also expressed concern about mixing Jumpshot's data with a marketer's own data.
"The data feed was expensive in itself but the infrastructure that you would need to build to get it into a usable format was beyond what I would be able to do," the agency source said. "It just never got off the ground."
Cristina Marinucci, North American lead of e-commerce insights and analytics at Johnson & Johnson, said she also was familiar with Jumpshot's pitch but was not a client. She said that Jumpshot's folding is a warning sign for marketers to ask how vendors collect data.
"It's important to really scrutinize the policies of your suppliers - we have to ensure that privacy policies and regulations are upheld," she said.