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Opus Capital, Helion Ventures Put $4M In Follow-On Round In Jivox

10 June, 2010

Opus Capital and Helion Venture Partners have made follow-on investments of roughly $4 million into Jivox, a technology-focussed online video advsertising firm, with operational hubs in San Mateo, California, and Bangalore. With this, Jivox has now raised $15 million in two rounds with seed investments by two promoters rolled into it.

The three-year-old firm caters to the online video advertising market in India and in the US. It counts on technology-enabling interactive features, better targeting of consumers and efficient analytics as a core differentiator in the expanding world of online ad networks.

The company is exploring fresh fund-raising in less than a year when it could look at infusing up to $15 million to accelerate sales and marketing expansion into newer georgraphies including Europe.

“At the moment, the plan is to look at funding in the first quarter of 2011. We could look at a figure similar to what we have already raised depending on how we chart our expansion,” Naren Nachiappan, Managing Director, Jivox India, told VCCircle.

Menlo Park-based Opus Capital, an early stage venture investor, along with Helion Venture Partners had invested $10.7 million in Series A funding in 2008, and topped it up with additional $4 million recently.

Hoping to report its maiden operational profit shortly, Nachiappan said, Jivox’s strategic transition from just an ad network (or content delivery platform) to a technology-driven player in the online video advertising space working well. “We made the transition pretty early in life, maybe within the first six months. Content delivery is becoming commoditised. Our differentiator is clearly technology, which engages and targets the consumer better,” he added.

In April this year, Tremor Media Network, a leading online video ad network in the US, raised $40 million in Series D from DFJ and Triangle Peak Partners. Tremor claims to serve up to one billion ads across 1,400 pushing sites reaching a potential audience of 82 million people.

Jivox works with most of the top brands in the automobile, financial services, electronics, travel & leisure and entertainment sectors in India. The firm’s revenue model works on fee per impression. It books spots on most of the top online publishers in India, and also in the US, and works on revenue sharing basis in some cases. 

India’s growing online advertising market is estimated at around $300 million, with the video component estimated at just $30 million. “We are pretty much building the online video advertising platform here. In India, while a sizable part of the new advertising money was coming into online video, the advertising market still remained ripe for print especially in the vernacular industry,” Nachiappan said.

“In the US, we are seeing advertising bucks moving from television to online video,” he added. “Even there, with multi-billion online video ad spending, the interactive features remain mostly custom made and can take several days. Our technology features can be super imposed on any creative within 20 minutes enabling us to deliver a fast turnaround,” Nachiappan explained.

Jivox believes that it has achieved a certain stability on the technology product development side and fresh capial infusion will be ploughed mainly into expanding the sales and marketing operations. Its current revenue is almost equally split between US and India but sees the former gaining a large share going forward.

While video is the fastest growing component of online advertising in the US, some consider 2010 to be the transformative year. Advertising Age, quoting forecasts made by eMarketer, said, spends on online video could grow as high as 50% to over $1,5 billion this year. Jason Glickman of Tremor Media was quoted saying that advertisers were “routinely buying seven-figure campaigns” as more dollars flow from television to web video.

But there are others who think that while online video advertising will boom, it may not hold much scaling up promise for start-ups. Big online networks such as Hulu TV and the search giants like Google and Yahoo could dominate the web video space limiting the potential for start-ups in what appears to be a lucrative opportunity.


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Opus Capital, Helion Ventures Put $4M In Follow-On Round In Jivox

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