Magnetic CEO Josh Shatkin-Margolis discussed the company’s $4 million in Series A funding led by Charles River Ventures, Ron Conway and NYC Investment Fund bringing total investment to-date to $5.25 million. According to the release, existing investors Founder Collective and IA Capital Partners also participated. Link to release coming.
How will Magnetic use the $4 million in Series A funding?
Magnetic will leverage the new capital to further build our core search re-targeting technology and expand with new solutions for advertisers and marketers that bring synergy to display media and search data. We will expand in three areas: product capabilities, sales team and business development team. We now have the resources to push forward on our mission to make search re-targeting easy for all types of media buyers.
Why is the NYC Investment fund a good fit as part of your Series A?
All of the investors in this round were a perfect fit. Lead investor Charles River Ventures, and more specifically Saar Gur from CRV who sits on our board, understands our business extremely well. Saar co-founded BrightRoll and worked at Adteractive before joining CRV — he has a great background for providing guidance to Magnetic. NYC Investment Fund’s board includes Kevin Ryan, former CEO of DoubleClick, and is another huge value add. We have always sought investors that understand our business and who can provide value well beyond capital. We are extremely excited to be partnering with CRV, NYCIF, Ron Conway and our seed investors, including Roger Ehrenberg, Founder Collective, and NYC Seed.
Since last we spoke, any recent buyer trends you can share in your search re-targeting business?
The biggest trend is that search re-targeting has many uses. Advertisers are most excited about what you can do with search re-targeting that you can’t do with traditional search engine marketing. For example: reaching users with a premium graphical display ad on a premium website, targeting users at any point in the purchase funnel (i.e., show credit report ads to home loan and car lease searchers) and conquesting.
Is education a big part of the Magnetic sales pitch? Or do you sell through intermediaries and they do all the heavy lifting? Is it getting any easier for buyers?
As with any new ad technology, education is the majority of the sales pitch. The majority of our data is sold through intermediaries (i.e., DSP’s, ad networks, publishers). As another option for advertisers and agencies who prefer to work directly through us, we can also facilitate buying media through those intermediaries because this may be a less-confusing process for marketers. The process is getting easier as the aforementioned data buyers now thoroughly understand what we do, while advertisers and agencies will have the option of working directly through us if it is easier for them to buy media and data from a single company.
What’s the reaction on the sell-side been like?
The publisher reaction has been good. They understand the value proposition and are excited to receive an increased CPM for their inventory. Search engines are getting eCPM’s of $10,000 for some keywords (i.e., 50% CTR with $20 PPC). Publishers know that these users often leave the search engines and go to their sites, but can only command a CPM of $1. By applying search re-targeting on these users, the publishers stand to make a lot more money. The large publishers are quickly catching on.
By John Ebbert