Viewers, investors and advertisers alike are tuning in as Vizio Holding Corp. (NYSE: VZIO) aims to build and maintain its standing as what its founder calls “the future of the smart TV industry.”
As of right now, there’s plenty to watch from the flat-screen TV and soundbar maker turned burgeoning digital media company founded by CEO William Wang.
Vizio is growing at a rapid clip, with more than 200 people hired this past year. It counts close to 250 employees at its Irvine Spectrum headquarters, along with an expanding base of operations outside the area.
The firm earned nearly $1.5 billion for the first nine months of 2021, up 14% year-over-year.
The breakout star of the company’s dual-pronged business model is its Platform+ advertising business, which surged 134% in the third quarter to revenue of $85.9 million.
The company closed its 2022 upfronts—the period in which advertisers can buy airtime ahead of the TV season’s start—at volumes that had quadrupled from 2021 to more than $100 million.
The company says it is seeing growth from advertisers in the insurance, financial services and automotive sectors.
Wang’s foresight for seeing where TV and connectivity was headed and its implications for marketers long ago is why the Business Journal honored him as one of four Businesspeople of the Year.
All four honorees featured in this edition took their companies public via initial public offerings in 2021.
It was the most active year on record for Orange County companies going public, with about $15.2 billion raised in total; see the Jan. 3 print edition of the Business Journal for more details on the record-setting year.
Wang and his management team took the company he started in 2002 public last March, raising close to $180 million in proceeds.
It was Vizio’s second stab at going public. A 2016 IPO was pulled after the company agreed to be sold to China’s LeEco for about $2 billion; that sale fell apart the following year after regulatory issues scuttled the deal.
The wait didn’t hurt the company’s valuation.
Vizio is now worth about $3.6 billion and is one of OC’s dozen or so most valuable public companies. It’s the largest TV maker based in the U.S., with a bulk of its sales at Best Buy, Costco, Sam’s Club and Walmart.
For Wang, he’s taking the move to the public markets all in stride.
While he described the IPO experience as surreal, from having a roadshow at home as a result of the pandemic to ringing the bell on the NY Stock Exchange, he’s been laser focused on the same mission as the one he had when he founded Vizio.
“I started the company because I feel like I benefit the consumer by bringing them great TVs at an affordable price,” he told the Business Journal.
“That was the only thing on my mind, and I didn’t really [think] we’re going to go public, we’re not going to go public or anything like that. It wasn’t on my mind at all,” he said.
Along with the added visibility in the market, one key benefit of the public listing, company officials say, will be the ability to attract new talent with promises of stock grants.
Building the Future
Success for Vizio has long been about selling TVs. That definition hasn’t changed much in the nearly 20 years the company has been around.
“I like to build, all my life. So, when I started the company, I wanted to build a great product for consumers. I wanted to build a great company that’s bigger than me and the mission’s the same,” Wang said.
“I’m just a part of the company now. I’m very flattered and happy that we’ve got a well-known brand. We’ve got a big organization that’s made of many talented individuals and a great team, and the company’s bigger than me,” he said.
The company’s overall revenue grew in the third quarter ended Sept. 30 by 1% to $588.3 million.
Vizio’s largest business, its legacy devices business, fell 8% to $502.5 million in the quarter as it lapped a Covid year in which it saw a run-up in TV sales as consumers worked from home and looked to invest in home entertainment upgrades.
Wang believes Vizio will be able to maintain its trajectory, even as the competitive landscape increases, because he says Vizio maintains a unique customer base different from other TV brands, such as Samsung.
That’s particularly key on the advertising front, as connected TVs remain what Wang described as “the hottest space right now.”
“We’re not really competing for other advertisers’ attention. We’re really competing to get more consumers. So, I think if Procter & Gamble wants to advertise on Samsung, they want to do the same on our TVs because their job is to reach as many consumers as possible,” Wang said.
While Platform+ is the smaller business by revenue for Vizio, and also the youngest having only been set up a few years ago, it’s the fastest growing.
Wang, when asked if the division will eventually surpass the devices business, said he doesn’t look at the two in that way.
“I think both [businesses] are equally important for us. TV sets are a way to acquire customers and for the Platform business, without TVs, there would be no Platform. These two go hand in hand for me; it’s not detachable. So, for me, it’s only one business. We’re in the business of TVs,” Wang said.
The Long Haul
It was a lot of time, money and effort spent into getting Platform+ to be where it is today, Wang pointed out.
It took over a decade of investing in the right software to ensure the devices business—the tool with which Vizio is able to sell ads—was robust enough to make money off content distribution.
Platform+ then is simply the remaining piece of a puzzle Wang began assembling many years ago.
Staying the course and not giving up has served Wang well.
“Not to give up has always been my approach because plenty of businesses, it’s always up and down. There’s always a good day and always a bad day. There’s lots of things that are unforeseeable,” Wang said.
The pandemic and, now, the global supply chain challenges, are the two most recent examples of this.
Wang credits Vizio’s ever-growing team for continuing to push the company through difficult times.
“Before Vizio, I had another company and that company did pretty well in the beginning, and didn’t do well in the end,” Wang said.
“One thing I learned was that I don’t think anybody knows what they don’t know, but my first go-round I believed that I knew everything because I was a pretty successful entrepreneur. In the beginning, I was only a 20-something, but later I found out there’s a lot of things I don’t know. This time, at Vizio, I invested in a lot of talented individuals who are better and have more experience than
The engineering major—who started Vizio after surviving a Singapore Airlines crash in 2000 that killed 81 of its 179 passengers and crew—has come a long way since his first business, when he didn’t know how to read a balance sheet or income statement.
Wang is the first in his family to start a company, but said he was influenced plenty by his parents, armed with skill sets he continues to use to this day.
“I learned discipline from my dad. From my mom, I learned how to collaborate with a lot of people,” Wang said.
Now, with Vizio celebrating its 20th year this year, the CEO said things are just getting started.
Said Wang: “This is only the first 20 years for Vizio and the thing I look forward to the most is to have Vizio a lot bigger than me. I think I’ve done that and I think Vizio [will] keep growing with all the talented people we have. We’re at our prime time.”