Charlie Lamar, former general counsel and board member, traces Lamar Advertising's roots to his grandfather Charles W. Lamar Sr.'s Pensacola billboard business, won in a 1908 coin flip.
Charlie Lamar says the 1991 bond and 1996 IPO were forced by the early-1990s financial crisis, which made bank financing the real turning point.
Ian Dallimore credits Bobby Switzer as the visionary behind digital screens, which now number over 4,000 at Lamar versus 94 eighteen years ago.
How Lamar turned small-market billboards into a billion-dollar company
Lamar Advertising grew from a Pensacola poster company won on a coin flip into a billion-dollar billboard operator by buying family-owned firms in mid-sized markets. For decades capital was the constraint, because banks misread a cash-rich business as unprofitable. Consolidation opened up bank and public financing, and digital screens later multiplied what each board could earn.
Takeaways
Mid-sized markets were Lamar's sweet spot. Lamar built out from Pensacola, already a 100 to 250 market, into places like Fort Myers, San Bernardino, Lafayette and Dayton, Ohio. Dayton became its first big market around 1980, and it tried the largest cities only twenty years ago.
Merging companies unlocked bank lending. Banks refused to lend from the 1950s through the 1970s because short depreciation schedules made billboards look unprofitable despite tremendous cash flow. Kevin Reilly Sr. merged 16 to 18 companies into the Lamar Corporation, which won a $50m bank loan.
Early acquisitions ran on owner financing. Before bank financing arrived around 1983 or 1984, Reilly Sr. bought family-owned companies with about 20% down and seller financing. Ian Dallimore calls it a gamble. Revenue multiplied 10 or 20 fold, reaching a billion-dollar value under Kevin Reilly Jr.
A banking crisis forced the IPO. Charlie ranks the 1991 bond and the 1996 IPO alongside bank financing as financial turning points. Lamar went public because banks demanded repayment in the early 1990s crisis. The Reilly branch still controls the company through its stock structure.
Zoning limits rivals as well as Lamar. Charlie spent his legal career on zoning, legislation and government relations, vetting acquisitions on legislative grounds. The 1965 Highway Beautification Act raised an amortization threat that Reilly Sr., a longtime legislator, judged would never happen.
Digital slots transformed per-board economics. Charlie doubted Bobby Switzer and Reilly Jr. when they promised digital slots would sell for nearly the price of permanent boards. He now says even a third of the price makes a board far more lucrative. Lamar runs over 4,000 digital boards, up from 94.
Ad tech now plugs into billboards. Ian Dallimore points to Vistar Media and PlaceExchange growing around the sector, with The Trade Desk connecting to Lamar's screens. Google is involved, and three of the top five out-of-home advertisers, including Meta and TikTok, are technology companies.
From a coin flip to Baton Rouge
Charles W. Lamar Sr. moved from Georgia to Pensacola in 1902.
Tap a name to go there · tap a line to see why they are linked
On this episode 2
Show 1
In 1908 he formed a partnership with Mr. Coe, manager of the Opera House. When they split, a coin flip gave Lamar the Pensacola Poster Company, just as the Model T began driving roadside demand.
Charlie's father attended Princeton, was sent to New Orleans and was pushed out by national competitor General Outdoor.
In 1927 the family traded its New Orleans boards for Baton Rouge boards. Lamar Baton Rouge much later bought out the Jackson, Mississippi business run by Charlie's uncle Mart and cousin Albert.