Banner ads? More like background noise.
Social display has become an attractive option for publishers trying to get around banner blindness, and there are now multiple startups on the market that help brands repurpose their social creative to run across the open web.
Growth in the sector is catching the attention of investment firms.
On Monday, London-based social display marketplace Picnic announced its $3 million Series A round. The bulk of the funding came from Guinness Asset Management, with participation from Picnic’s network of angel investors and shareholders.
Picnic plans to use its cash infusion to fund an ambitious three-year growth plan. The company will spend roughly half on its expansion into the US market, with plans to open its first US-based office in New York by April followed by a West-coast office about 18 months from now.
Around 35% of the remaining capital will be dedicated to research and development, including building out a new social context targeting product, which Picnic hopes to launch within the next nine months.
The rest of the money is being earmarked for the development of a publisher-focused product.
To facilitate new product development, Picnic will be increasing its engineering headcount from three to 12 in the coming year, including the addition of two product managers. The company's current total employee headcount is 20, and it plans to increase that number to 45 by the end of next year.
The purpose of Picnic’s products is to “replicate the form, function and design of social,” said company Founder Matthew Goldhill. These include a service that mimics the familiar format of Instagram Stories, a Tinder-esque platform that allows audience members to swipe right on ads and an emoji reaction bar that populates ads with real-time audience reactions.
Picnic hopes to expand its product suite to connected TV apps. Most ads for CTV are currently video-based, but there is room for social display synergy in CTV apps that have promotional feeds that could be populated with Stories-like content, Goldhill said. However, he explained that Picnic likely won't be prepared to offer a CTV-focused product until at least two years from now.
At least for now, Picnic isn’t looking to get acquired and doesn’t plan on seeking any additional funding from outside investment groups until its three-year growth plan is complete, according to Goldhill.
“From my perspective, the best companies in the space have been profitable almost from day one by bootstrapping,” he said. “Our goal is to grow without being too capital intensive.”