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Advertising - Tuesday, April 17, 2007

New NBC/GE VC Arm Invests In Adify As Part of $19M Round

In our opinion, Adify is one of the most interesting new online ad businesses to have launched recently. Founded in 2005, San Bruno, CA-based Adify works with large media companies including Time Warner, The Washington Post Company, Reed Business Information, NBC Universal, The Guardian Group, RP Online, and Comcast (as well as fledgling ad networks). These large companies have more content than they know how to monetize. Adify then creates vertical networks for them that advertisers can get behind. It currently supports over 30 leading vertical ad networks.

Today, Adify received the first $3M investment announced by a fund which is overseen by NBC Universal and GE Media, Communications and Entertainment. GE just launched a $250M equity fund to invest in media and technology companies. The $3 million as part of a broader round of financing that raised $19M. Other investors were US Venture Partners, Venrock Associates and Time Warner Investments.

Speaking at the Web 2.0 conference recently Larry Braitman, co-founder and CEO of Adify said "We envision thousands of niche or vertically-focused ad networks emerging to meet specific market needs, driven by entrepreneurs and enterprises who are members of the specific communities they serve. These network builders are in the best position to assemble publishers and deliver value to advertisers."

Washingtonpost.com selected Adify's platform to enable advertising across its recently launched Sponsored Blogroll advertising network. Smaller networks that use Adify include: Top Dog Ad Network (for dog lovers); FW Webcom (for Veterans of Foreign Wars) and SportsSyndicator (for extreme sports sites).

The concept driving Adify is that advertisers are best served by extremely vertical networks. One the one hand we buy this as it has become impossible for a generalist ad network to have relationships and knowledge of the world of niche sites. On the other hand, advertisers are saying that they think there are already too many ad networks and options for them to deal with. Furthemore ad exchanges like Right Media and behavioral networks which say it doesn't matter what site someone opens they target behavior. It will be very interesting to see how this plays out.

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