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Advertising - Friday, September 24, 2004

ContextWeb - Profile

HQ: New York, NY

Founded: 2000

Management: Founder's CV is not terribly impressive. CEO Anand Subramanian was the Vice President of Product Development at something called Gobi. However, it is his VPs who hold the keys to success. Jay Sears is in charge of Publisher Relations. He boasts a key role in the book - Burn Rate by Michael Wolff - where Sears headed marketing for Wolff New Media. Andrew Jacobson is VP of Sales and was previously head of sales for DoubleClick.

Investors: Company's first round was in September 2004 - $3M from Draper Fisher Jurvetson and its affiliates, DFJ Gotham and DFJ New England.

Business Model: Contextual ad network, like Adsense except that ContextWeb claims its R.O.C.K.* technology is the first to extract terms from a Web page in real-time. This finer control over contextualization allows for more efficient placement of ad inventories.

Competitors: Quigo, Kanoodle, Industry Brains.

Dirt: Ad networks are an easy investment. For $3M DFJ gets a product and a company that might even get to profitability before a new investment is needed. The ad market is seeing a flood of money and advertisers and publishers are willing to experiment. They will try relatively small sums, but for a start-up that can be serious jing. The trouble is that there is a high level of transparency in the market, so competitors can mimic each other and soon enough there is bound to be a good shakeout.