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Advertising - Thursday, September 27, 2007

Are Startup Facebook App Ad Networks Viable?

A number of ad networks have been launched to help developers of Facebook Apps to earn revenue from them. Gigaom counts: VideoEgg’s Egg Network, Lookery, FBExchange, Social Media, CanvasExchange, Cubics as well as some from the dot.com world that are migrating to Web apps. Today, another entrant called Appfuel has come out and says it has raised venture funding.

It is confounding that these startups are run by sharp, successful people, so we are hesitant to question the business here. Indeed we get it that impressions of Facebook apps are exploding outward and somebody needs to step in and pull some cash off of it.

Where these startups breakdown for us is that they are led by tech-minded people. We'd feel much better about their future if they were led by Glengarry Glen Ross Only Closers Get Coffee minded people. Sure such red meat eaters can be hired but that takes some time, especially in this competitive market.

We understand the proliferation of tech minded startup ad networks in video and mobile, because there some real technology needs to be built. But we don't see that there is much in the way of tech that needs to be built to run ads on Facebook apps. So it comes back to who has the loser leave town mentality salesforce who can successfully sell Facebook Aps on a CPM basis to brand advertisers. Because really, nobody wants to be paid CPA and CPC on Facebook apps we understand is a hard way to make a living. So yes a Facebook app ad network is viable, but it would happen thanks to old fashioned salesmanship.

AppFuel's CEO breaks down the Facebook app ad options.